For much of the early 2000s, Brazil, Russia, India, and China (the Brics) were seen not just as “the engine of new demand growth and spending power,” as Goldman Sachs researchers put it in 2003, but also as the likely begetters of a new international order, in which the US – and the west more generally – would play a much less significant role.
Today, the idea that the Brics could lead the way to this new order seems more distant than ever.
The Brics lack the economic clout to play that role. Past years have shown that economic growth in countries such as Brazil and Russia, driven by global demand for commodities including natural gas and oil, iron ore or soybeans, cannot be sustained indefinitely. China is hitting the limits of how much it can invest productively each year without creating bubbles or white elephants. India, in turn, is still waiting for the ‘second-generation reforms’ that would open its economy to foreign investors and liberalise its rigid labour markets.
The full text of this article is available here.
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