By George Hoguet, Global Investment Strategist, State Street Global Advisors
The achievements of the recent Brics summit deserve another look.
Global investors should welcome the proposed $100bn Contingent Reserve Arrangement and the planned Development Bank backed last month by the leaders of Brazil, Russia, India, China and South Africa. The Brics shareholders have yet to work out the details of these institutions, but the political resolve is clearly in place. Continue reading »
The fact that the axis of world energy consumption is moving east isn’t exactly new – but the International Energy Agency is finally responding to the inevitable.
As the FT reported on Thursday, the agency is seeking an association with emerging economies, including the four Bric states. So beyondbrics has put together a couple of charts that show the change in energy consumption – and where it could go in the next two decades. Continue reading »
Jim O’Neill, retiring chairman of Goldman Sachs Asset Management and author of the “Bric” acronym, has no idea what he will do after he clears out his office on London’s Fleet Street in a few weeks.
The candid Mr O’Neill, a Mancunian to his core, mulls the question as if to put the matter to rest. Continue reading »
By Simon Evenett of the University of St Gallen
Every summit has to have a deal and Durban is no different. Publicity-hungry ministers used to initial investment deals, now they sign currency swaps. The Sino-Brazilian currency swap won’t impact day-to-day trade much. Two countries with huge foreign exchange reserves have decided to swap some currency when times are tough.
It’s like two millionaires promising to lend each other ten dollars if they’re temporarily short of cash. Brasília and Beijing are signalling their desire to intensify trade, which is fine but hardly earth shattering. Continue reading »
Imagine a group of five friends who get together to build a holiday house. Only they can’t agree on what it should cost, where to put it or who should pay for it.
This roughly is the position of the leaders of Brazil, Russia, India, China and South Africa as they end their annual Brics summit. Continue reading »
By Shang-Jin Wei of Columbia Business School
The economic collapse of China has been predicted before, notably by a US best seller in 2001, entitled The Coming Collapse of China.
The only problem with that volume of forceful and insightful analysis is that in the ensuing dozen years, China has been the fastest-growing major economy in the world. It didn’t just grow faster in terms of real GDP than most high-income countries, which is not surprising, but also faster than India, Brazil and Russia, its emerging market peers that are routinely lumped together with China as if they were part of a homogenous brick. Continue reading »
By Martyn Davies of Frontier Advisory
After the onset of the (western) financial crisis of 2008, there has been a deep questioning of the free market ideology encapsulated by the phrase “Washington Consensus.”
At least this is the case in Africa. For a while there was debate over whether an emerging “Beijing Consensus” would gain traction and become the developmental compass for the developing world – a model that was “statist” in its approach and inherently distrusting of markets. Continue reading »
By Duncan Green of Oxfam
The Brics grouping of countries is starting to generate some interesting conversations of its own. Last week, I was in Durban, chairing a discussion between academics and activists from South Africa and Brazil ahead of the Brics summit later this month. The topic? ‘Tackling inequality across Brics’. Continue reading »
By John Thornhill
Much attention at the forthcoming Brics summit in Durban on March 26 will focus on the progress the five countries have made over the past year to set up a joint development bank.
But, according to Gill Marcus, governor of the South African Reserve Bank, there is still a long way to go to turn their ambition into reality. “This is a very high-level concept and it is still very early stages. What we are looking to do is to provide more resources for infrastructure development,” she told the FT on the margins of the Ambrosetti finance forum held over the weekend in Italy. Continue reading »
Brics summit: so last year
The plans of the Brics countries to establish a Brics bank are gathering pace in the advance of the fifth summit next month of the five countries – Brazil, Russia, India, China, and their poor cousin South Africa.
Even though key decisions have yet to be made – such as where it would be based and what exactly it would do – some elements are emerging from the discussions, notably the bank’s possible capital – $50bn. Continue reading »
By Gerardo Rodriguez, former Mexican under secretary of finance
When Jim O’Neill published his seminal piece “Building Better Global Economic BRICs” in 2001 he never imagined the economic and political impact he would trigger just by coining the term Brics. Few now remember that the main argument of his essay, which was a suggestion on how to improve global economic and financial governance, turned out to be off target. Continue reading »
It’s the end of an era. Jim O’Neill, aka Mr Bric, is retiring from Goldman Sachs later this year, the bank said in a surprise announcement on Tuesday.
A larger-than-life figure who made a big impression wherever he went, be it in the foreign exchange trading room where he started his financial career or at Manchester United, the football club he has long supported and once tried to buy. Professionally, he will always be associated with Goldman Sachs, where he rose to be chief economist and later chairman of its asset management arm. Continue reading »
Hold steady – the risk / reward balance is tipping. The Brics are now being termed “safe haven” markets and grouped with the UK, US and Germany.
For some time emerging markets have attracted multinational companies with the promise of higher returns. This draw used to come with higher risk – but the perception of that risk is now shifting. Continue reading »
In Europe and the US, they are often called “squeezed” or “worried”. In developing markets, they are “booming”, “growing” and, of course, “emerging”.
The middle classes are changing consumption habits around the world. Chart of the week takes a look at some key emerging markets and the level of middle class spending. Continue reading »