BRICS

GROUP NO : 9PRITI THAKUR 113KRUTIKA NIKAM 153SAYLI PATIL 156

LEADERS

What is BRICS? BRICS stand for Brazil, Russia, India, China & South Africa.

Came into existence in the year 2001 as BRICNATIONS.

BRICS is international political organization of leading emerging economies its Five members are all developing industrialized countries.

Biggest and fastest growing emerging economies

Term BRIC was first prominently used in a Goldman Sachs report from 2003.

Officially admitted as a BRIC nation on December 24, 2010

Why South Africa?

OB

JEC

TIV

ES

To achieve regional development

To remove trade barriers.

Economic development.

Optimum use of resources.

Building relationship.

Focus of BRICS forum To establish a development bank to balance the influence of the

World Bank and IMF, as well as creating a joint foreign exchange reserve.

Business Competitiveness Governance & Leadership Science & Technology Poverty Private Sector & Prevention of Corruption Investment Landscape Innovation in building Infrastructure Trade Healthcare

KEY ADVANTAGESBRAZIL RUSSIA INDIA CHINA SOUTH

AFRICAOne of the fastest growing economies in the last century

Russia has capability in high-technology sectors

1.15 billion people

Broad expansion of educational achievement

The South African economy is now the 23rd largest in the world

Brazilian economy becoming less dependent on exports

Accounts for around 20% of the world’s oil and gas reserves

2nd largest labor force

Rapid economic growth

Inflation is now below 5% and falling.

Extremely rich in resources such as coffee, sugarcane, iron , and crude oil etc

Fall in the number of people living below the poverty line

Approximately 2.5 million college graduates per year

Third largest country in land size

25% of goods produced in South Africa are for export

PROBLEMATIC FACTORS

IMPORTANT INDICATORS

• GINI INDICATOR

EASE OF DOING BUSINESS

EXPORT IMPORT COMPARISION IN BRICS

KEY INDICATORS

12

26 % of Earth's land area 42 % of world's population 46% of world’s work force 19 % of world´s nominal GDP

BRICS BANKStructure: New Development Bank will have an initial subscribed capital of $50

billion which will be raised to $100 billion. The five members will have an equal share for each in the bank, so no one member dominates the institution. Headquarters – Shanghai Bank will have African Regional Center in South Africa India will assume the first presidency of the bank. Chairman of Board of governance will be Russian.It will have $41 billion from China, $5 billion from South Africa and $ 18 billion from remaining nations.

Needs for the Bank: Global financial institutions like IMF and world bank are dominated

by U.S and western countries IMF and world bank follows different voting power based on quota

system. Though China is second largest economy after U.S it has fewer voting rights.

The financial institution created by BRICS will reduce the importance of US dollar as a global currency and eventually it will increase importance of Yuan

IMF cash assistance program is conditional. If a country's foreign policy clashes with US then it will be difficult to obtain a loan.

It will provide resources for infrastructure development of developing countries.

BRAZIL

• SIZE 8.5 M SQ. KMS• POPULATION 190 MILLION• POVERTY (% OF POPULATION)

20010 46.7%2012 30.3%CHANGE 16.4%

AGRICULTURAL AND MINING POWERHOUSE. EXPECTED TO BECOME MAJOR WORLD PLAYER IN WORLD

ENERGY MARKET, HAVING FOUND HUGE DEEP-SEA OIL RESERVES.

POVERTY (% OF POPULATION)

RUSSIA

• POVERTY (% OF POPULATION)• SIZE 17M SQ. KMS• POPULATION 143 MILLION

2010 27.5%2012 13.0%CHANGE 14.5%

POVERTY (% OF POPULATION)

WORLD’S SECOND LARGEST OIL EXPORTER, BUT FALL IN OIL PRICES COULD TRIGGER WORST RECESSION IN AT LEAST A

DECADE, CONTRACTING GDP BY AN EXPECTED 6% .

INDIA• SIZE 3.3M SQ. KMS• POPULATION 1100 MILLION• POVERTY (% OF POPULATION)

2010 27.5%2012 21.8.0%CHANGE 5.7%

POVERTY (% OF POPULATION)

VAST DOMESTIC MARKET PUTS IT ON THE TRACK FOR GROWTH

THIS YEAR. FACES POTENTIAL TROUBLE FROM DOMESTIC MILITANT

GROUPS AND A LONG RUNNING BORDER DISPUTE WITH PAKISTAN.

CHINA• SIZE 9.6M SQ. KMS• POPULATION 1300 MILLION• POVERTY (% OF POPULATION)

2010 16%2012 4%CHANGE 12%

1; 2008; 4

POVERTY (% OF POPULATION)

A GLOBAL MANUFACTURING HUB, HELD $727 BILLION IN U.S. TREASURIES AT YEAR-END 2012. ESTIMATED TWO-THIRDS OF ITS ROUGHLY $2 TRILLION IN FOREIGN RESERVES PARKED IN DOLLAR ASSETS.

BRICS v/s World(2015)“Potential of BRIC is such that they could become among the four most dominant economies by the year 2050” ~ Goldman Sachs in 2001

MIST V/S BRICS

• Goldman Sachs economist Jim O’Neill in 2005• Mexico, Indonesia, South Korea and Turkey• Economy doubled in last decade. • 7% of the world population• 3% of global land area• 1% of global GDP each• Fast-growing markets for consumer goods and services

MIST vs. BRICS- MARKET

• Mexico –(MEXBOL) 11 %growth

• Indonesia’s -JCI gained 7.4%

• South Korea’s-KOSPI 3.3% growth.

• Turkey’s-ISE(XU100)-28

• India-(BSE) 13% growth

• Russia -2.6% gain• China-SHCOMP 2 %

drop• Brazil –IBOV and

South Africa -2.8% growth

GDP

ECONOMIES AND GOVERNANCE

BRICS MIST

Countries Rank Countries Rank

Brazil 84 Mexico 65

Russia 112 Indonesia 58

India 100 South Korea 34

China 56 Turkey 62

South Africa 63

LOCAL CURRENCY AND INFLATION

BRICS SUMMIT The BRIC countries met for their first official summit on 16 June

2009, in Yekaterinburg, Russia.

Discussed the current global financial crisis, global development, and further strengthening of the BRICS group.

Issued a joint statement on global food security, calling for "action by all governments and the relevant international agencies“

2nd BRICS Summit held on April 16,2010 Brazil

3rd BRICS Summit held on April 14, 2011 china

4th BRICS Summit held on March 30,2012 India

5th BRICS Summit held on March 28,2013 South Africa

6th BRICS Summit held on July 7 ,2014 Brazil

7th BRICS Summit held on July 10, 2015 Russia

8th BRICS Summit to held on October 17,2016 India

AGENDA OF 7th SUMMIT

The summit coincided with the entry into force of constituting agreements of the New Development Bank and the BRICS Contingent Reserve Arrangement and during the summit inaugural meetings of the NDB were held, and it was announced it would be lending in local currency; and open up membership to non-BRICS countries in the coming months

BRICS INDIA - 8th Summit in OCT 2016, GOA

Invited - Bay of Bengal Initiative for Multi-Sectoral Technical and Economic cooperation (BIMSTEC) is an international organization involving a group of countries in South Asia and South East Asia.

Bangladesh, India, Myanmar, Srilanka, Thailand ,Bhutan, Nepal

BRICS summit focus sectors

• Finance Areas (Investments)• Social & Cultural exchange• Trade Agreements in areas of :

InfrastructureAgricultureEnvironment

Advantages• Growth agenda of BRICS economies as a whole• Growth agenda of other smaller regional economies• BRICS development is Important driver for global economy• Improvement in trade relations when “good going” and helps regional

outreach• Sports & Cultural exchange• Helping smaller nations for productive use of resources• To Connect & Share technology and share resources, conduct free

trade and share innovation from BRICS to other regions globally…(Arun Jaitley in BRICS Summit 2016)

Dis -AdvantagePropaganda news on BRICS to compete with IMF and World BankIndividual International disputes and arbitration being taken up as part of

BRICS agenda

BRICS could be larger economies than the united states and the developed economies of Europe within 40 years .

• China and India will become world’s dominant suppliers• Brazil and Russia will become dominant suppliers

BRICS Moves Up in USD-Denominated GDP Ranking

BRICS – Growing Size Of economy1

BRICS Nation Economy (GDP) Ranking improved

4 BRICS nation to be amongst top five

BRICS Moves Up in USD-Denominated GDP Ranking

The Growing Dominance of BRICS

BRICS – Growing Size Of economy1

2

BRICS Nation Economy (GDP -PPP) growing dominance over world

Around 40% of GDP (PPP)

contribution will be from

BRICS

BRICS Moves Up in USD-Denominated GDP Ranking

BRICS – Growing Size Of economy

The Growing Dominance of BRICS

1

2

BRICs have become a key player in Global Trade Flows

3Around

4500bn USD of Global trade

by BRICS which is about 15% of total .

CONCLUSION

We believe the BRICS markets retain strong characteristics that attract equity investors.

We can count here a strong economic growth, favorable demographics, rich natural resources, and strong finances. The worries and uncertainty will likely continue to create

some angst in the global market,But

we firmly believe that these markets should do well in the long-term