Brics- Brazil, Russia, India, China and South Africa

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BY: Pragya [email protected] il.com 1 BRICS EMERGING ECONOMIES…..

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BY: [email protected] 1BRICSEmerging economies..

What stand for BRICS? BRICS stand for Brazil, Russia, India, China, South Africa.BRICSis international political organization of leadingemerging economies its Five members are alldeveloping and newly industrialized countries.

Agreements between group of countries within a geographic region To reduce & ultimately remove the tariff and non- tariff barriers to the free flow of the goods, Services and Factors of production between each other

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Objective of BRICS nations.

To achieve regional developmentTo remove trade barriers.Economic development.Optimum use of resources.Building relationship.

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ABOUT BRICS FORUM

The BRICS Forum was formed in 2011

It is an independent international organization that works for a structured social, economic and environmentally sustainable BRICS block.

Currently the forum is working on building partnerships and collaborating with member state institutions.4

Currently the forum is working on building partnerships and collaborating with member state institutions to provide cutting edge information for businesses and industry alike4

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.BusinessCompetitivenessGovernance & LeadershipScience & TechnologyPovertyPrivate Sector & Prevention of CorruptionInvestment LandscapeInnovation in building InfrastructureTradeHealthcare5

2.BUSINESS The forum will work with business units in the member states to form effective standards for information exchange. This would facilitate better access of information and avenues of growth.3. COMPETITIVENESS The forum will develop indicators of competitiveness specific to the BRICS nations which helps in understanding the markets better4. GOVERNANCE N LEADERSHIP The forum will work with state units as well as private sector to develop better practices that would help the BRICS in building a sustainable bloc5. SCINCE N TECHNOLOGY The forum has identified Science & Technology as a key area for the BRICS to focus on. With emphasis on academic network alliances between the member states, cutting edge practices in the field will be used to handle the focus areas.6. POVERTY The forum realizes the importance of poverty reduction in the member states and will work with various private organizations and entrepreneurs to use technology to reduce poverty and increase awareness of literacy5

BRAZIL

10th fastest growing economies in the last centuries.

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

Focus on equitable development has resulted in significant poverty reduction.Textiles, chemicals , iron ore , steel and motor vehicles industries.Brazil today is the most popular of the BRICs so far as foreign direct investment is concerned.6

KEY ADVANTAGES :One of the fastest growing economies in the last centuriesBrazilian economy becoming less dependent on importsExtremely rich in resources such as coffee, sugarcane, crude oil and iron etc.Focus on equitable development has resulted in significant poverty reduction.

CHALLENGES FOR THE FUTURE:Overburdened and ineffective judicial system.Industrial output is weak

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RUSSIARussia has capability in high-technology sectors

Accounts for around 20% of the worlds oil and gas reserves.

Fall in the number of people living below the poverty line.

Consumer market of over 140 million people.

68% of people comes under middle income group.

Highly educated workforce.

Third largest exporter of steel and aluminium

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INDIA1.2 billion people

2nd largest labour force

Holds second place followed by China in BRICS

Democratic country.

Broad knowledge economy.

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KEY ADVANTAGES1.15 billion people2nd largest labour forceApproximately 2.5 million college graduates per year.Democratic country.

CHALLENGES FOR THE FUTUREImproving basic educational achievementImproving infrastructure and electrical capacityExpanding technology industry

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CHINA18Th fastest growing economy.

Third largest country in land size.

Biggest of all BRIC nations GDP wise.

13% of people comes under middle income group..

Holds more than $3 trillion forex reserves.

Largest exporter/ importer for 32 and 34 countries respectively.

Cheap labour work force9

KEY ADVANTAGES Broad expansion of educational achievement Rapid economic growth Third largest country in land size

CHALLENGES FOR THE FUTURESupport to rural areas and less-developed regions Bank of China sees inflation as a bigger risk Need to improve the investment

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SOUTH AFRICAThe South African economy is now the 23rd largest in the world

Inflation is below 6.6% and falling.

25% of goods produced in South Africa are for export

Richest in terms of its mineral reserves.

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KEY ADVANTAGEThe South African economy is now the 23rd largest in the worldInflation is now below 5% and falling. 25% of goods produced in South Africa are for export

CHALLENGES FOR THE FUTURE:The economy is growing but not fast enough Lack of skills, particularly in IT. 48% of the population is living below the poverty line

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Potential members

Indonesia,Turkey,MexicoandGermanyhave been mentioned as candidates for full membership of the BRICS,whileEgypt,Argentina,Iran,Nigeria,Syriaand most recentlyBangladeshhave expressed interest in joining BRICS

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Few facts about the BRICSThe BRICS countries make up 21 percent of global GDP. They have increased their share of global GDP threefold in the past 15 years.

The BRICS are home to 43 percent of the world's population.

The BRICS countries have combined foreign reserves of an estimated $4.4 trillion.

Intra-BRICS trade flows reached $282 billion in 2012 and are estimated to reach $500 billion by 2015. In 2002, it was $27.3 billion.

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Summits

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The BRICS leaders in 2014. Left to right:Putin,Modi,Rousseff,XiandZuma

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TARGET SECTORS FOR BRICS TRADEManufacturing, services and agriculture

Energy, infrastructure, mining beneficiation and healthcare

Construction and water provision

The green economy and tourism15

Chinas economy is driven by its exports of manufactures and central role in the global value chains; but its domestic consumption is still very limited, which creates a current account surplus for China. There is Chinas currency manipulation, where the pegging of the renminbi to the US dollar gives China an unfair trade advantage by making its exports cheaper. The currency issue is and will continue to be a source of tension in the BRICS unless it is dealt with effectively. Indias economy, on the other hand, is driven by strong capital imports and, because of its flexible exchange rate olicy , it is plagued by current account deficits. Brazil and South Africa are also experiencing current account deficits. 15

challengesDevelopment of BRICS bank

Reducing the rural/urban income gap

Maintaining macroeconomic stability

Inadequate Financial reforms

Managing Supply Chain

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ADVANTAGESIndia is also expected to grow faster thanChinaafter 2020Rising incomes in the BRICs nations will create a new middle consumer classFeatured as- Roadmap For ContributionImportant drivers for growth in the global economy.

Expansion of their consumer markets and the rise of multinational companies.

The establishment of a positive multipolarity" in international affairs17

DISADVANTAGESLost speed and altitude over the past two years

Chances of Intra Trade Disputes are high

Difficulties of articulating their conflicting interests in some sort of common vision became more evident.

Different viewpoints and influence in the international arena.18

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,Butwe firmly believe that these markets should do well in the long-term19

. Emerging countries abilities to balance growth, inflation and global competitiveness will be a crucial factor in this. Even if their overall growth this year may be a little lower than in recent years, most of these economies are still expected to grow faster than those of developed nations.

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THANK YOU20