Doing business with BRICs
Emergence of the BRIC (Brazil, Russia, India and China) economies will be one of the greatest influences and opportunities for business and investment in the next decade. Just as Britain grew to dominance during the industrial revolution of the 1800s and the US during the 1900s, this century will, and is already seeing, the emergence of the BRIC countries as dominant economic players.
Most economists agree that during the next 20 years, China will overtake America to become the largest economy in the world, with India, Russia and Brazil not far behind. It will become increasingly important for entrepreneurs, businesses and investors to properly understand and gain experience in the new BRIC economies, so that deciding to invest or do business (or not) in these markets is a considered, rational progression – not a blind leap of faith!
While the four BRIC countries exhibit many differences, in terms of their local culture, society, language, history and politics, they all exhibit a number of common characteristics, which make them important for business and investment, for example:
They all have large populations (four of the six largest populations in the world).
- China: 1.3 billion
- India: 1.2 billion
- Brazil: 191 million
- Russia: 141 million
They have large areas of land available for farming and mining.
- Russia: 17.1 million sq km
- China: 9.6 million sq km
- Brazil: 8.5 million sq km
- India: 3.3 million sq km
They are already some of the largest economies in the world, and growing faster than developed countries.
- China: US$4,909 billion, growing by 10.3 percent per annum
- Brazil: US$1,574 billion, growing by 3.5 percent per annum
- India: US$1,236 billion, growing by 7.4 percent per annum
- Russia: US$1,229 billion, growing by 5.5 percent per annum
When you combine the three traditional economic forces of big populations, large areas of land and the availability of capital and wealth, an interesting picture emerges:
The four BRIC countries, together with the US, represent the five most influential and dominant economies in the world today for business and investment. And, unlike the US and other developed economies, the BRICs are growing rapidly, applying their available capital into long term growth assets, for example infrastructure, construction and to raise lower incomes, and building new wealth among their emerging middle classes.
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