BRICS Economies: Rise, Accomplishments, Failures & Global Relevancy

This essay provides a comprehensive analysis of the BRICS nations (Brazil, Russia, India, China, and South Africa), examining their rise from developing countries to emerging economies and their impact on the global landscape. It details the accomplishments of BRICS, including improved trade, increased foreign direct investment, economic growth, and financial stability, while also addressing their failures, such as the inability to form common policies and maintain unified growth rates. The essay further explores the relevancy of the BRICS group, the challenges they must overcome to remain significant, and their unique approach to international cooperation, particularly with low-income countries, emphasizing technical assistance over financial aid. The analysis covers each member state's profile, highlighting their contributions and focuses within the BRICS framework, and concludes with an assessment of their future prospects and the need for continued adaptation to maintain global relevance. Desklib provides access to this essay and many other solved assignments for students.

Running head: BRICS
The BRICS (Brazil Russia India China and South Africa)
Name
Institution

BRICS 2
Table of Contents
Introduction......................................................................................................................................3
Background Information..............................................................................................................3
Profile of BRICS member states..................................................................................................5
Brazil........................................................................................................................................5
Russia.......................................................................................................................................5
India..........................................................................................................................................6
China........................................................................................................................................6
South Africa.............................................................................................................................7
The Rise of BRICS from Developing Countries to Emerging Economies.....................................8
Accomplishments of BRICS..........................................................................................................10
Improved Trade..........................................................................................................................10
Increase in Foreign Direct Investment.......................................................................................11
Economic Growth and Development.........................................................................................12
Financial Stability......................................................................................................................13
Failures of BRICS..........................................................................................................................14
Failure to common form policy.................................................................................................14
Failure to Bring Unity................................................................................................................14

BRICS 3
Failure to have a Common Growth Rate...................................................................................15
Relevancy of the Group.................................................................................................................15
Challenges that BRICS Must Overcome to Remain Relevant......................................................15
Conclusion.....................................................................................................................................20
References......................................................................................................................................22

BRICS 4
Abstract
Brazil, Russia, India, China and South Africa are emerging economies who in the last
decade have emerged as a group seeking to change the structure of international development
politics. In the course of the last 10 years the five countries have increased their assistance
especially to the Low Income Countries; both financial and technical assistance. In so doing
BRICS have come up with unique methods of cooperation with the Low Income Countries. The
5 countries are determined to upset the traditional donors in Western countries particularly the
European Union (EU). The common features of BRICS include; their massive economies, high
economic growth rates and fair share of the global economy and their common push for a
recognition in the global governance and development. Even so, BRICS are sovereign states and
the member countries still retain their individual relationships with other countries. The
relationship of the BRICS with developing countries follows the order of the SSC (South-South
Cooperation). This mode of international cooperation is founded on a belief in shared
experiences, solidarity in action and the pursuit for reliance of the Southern states. Trade,
Foreign Direct Investment and development financing have characterized BRICS relationship
with Low Income Countries.
Introduction
Background Information
Brazil, Russia, India, China and South Africa (BRICS) are top developing economies and
political powers both at the regional and international levels. The acronym BRICS was initially
begat in 2001 to underscore the significance of 4 developing economies and at the time included

BRICS 5
only Brazil, Russia, India and China (BRIC). It was held then that the high growth rate of their
economies, economic strength and demographics (massive population) would put BRIC in a
position of advantage and it was contended that their expanded significance ought to likewise be
reflected in their joining to the G7 (De Almeida 2011). The four nations themselves started
holding engagements in 2006. In 2010, South Africa by invitation from the other 4 countries
joined what would then become BRICS after several years of lobbying. Due to the geographical
sizes of the 5 countries, massive populations and large economies, the BRICS states have had a
significant impact on global development, particularly in Low Income Countries (LIC).
LICs account for nearly 1.4 billion of the world’s population of people who live on less
than 1 US dollar a day. The economies of the LICs are very prone to external shocks and are
characterized by volatility of commodity prices and fluctuating food prices (IMF 2011). BRICS
are upsetting the current structure of international development and trade arrangements. This is
owed to their financial flow as well as their emergence as donor countries. BRICS is seeking to
break away from the established donor patterns. As at 2010, emerging donors had raised more
than 90.6 million US dollars to support the World Food Program and another 87.1 million US
dollars in support of the UN Emergency Relief Fund (ERF). The subject of investigation in this
paper will be the effect of the BRICS on the economies of the LICs and how their economies are
interdependent as well as the approaches of BRICS in pursuing development policies.
BRICS have a different form of partnership with developing countries where technical
assistance is preferred over financial assistance. To a great extent the three approaches in
international cooperation employed by BRICS has contributed to significant economic
development in countries where they have been utilized well. Notwithstanding these efforts, a

BRICS 6
majority of the developing countries are still heavily dependent on imported primary products
and their economies are in dire need of diversification. There are a number of similarities in the
assistance given by BRICS although their foreign aid institutional structures are markedly
different. The bulk of the assistance given by the BRICS goes to countries neighboring them.
Their main goal of cooperation is regional integration. They all perceive trade and investments as
the means to achieving economic development. Their guiding principle is that of non-
interference; as such, their focus is not trained on human right and governance issues. BRICS are
proponents of technical assistance rather than financial assistance. Brazil, India, China and South
Africa were in attendance during the round table talks held in Paris and Accra in two capacities;
both as donor countries and as donor recipients.
BRICS was invited for the European Consensus on Development and the Agenda for
Change although they were not recognized as donor countries in the summit. BRICS as emerging
donors are not keen to join the Donor Assisting Countries (DAC) which is made up of the
traditional donor countries. Rather, they have chosen to pursue their course via multilateral
relationships as well as other international fora such as the G20. Markedly their approach to aid
is also distinct from that of traditional donors; while the latter invest heavily in financial
assistance; BRICS is keen on technical assistance as the driver for economic development.
Experts opine that BRICS are gaining traction and influence in the design of international
development cooperation and need to be recognized as emerging donor countries. As such they
should be engaged in a structured way in the global trade talks going forward.

BRICS 7
Profile of BRICS member states
Brazil
The country’s institution in charge of international cooperation is the Agência Brasileira
de Cooperação” (ABC). The bulk of Brazil’s foreign aid is channeled to its neighboring
countries such as Bolivia, Paraguay and the Andean region. Foreign aid from Brazil is majorly
invested in the social sector, education and health and poverty eradication. Brazil is also a major
contributor of emergency aid being one of the world’s leading exporters of agricultural products
(De Almeida 2011). Brazil spends between 342 million US dollars to 1 billion US dollars per
year on foreign aid (accurate figures on the same are scarce). It also spends an estimated 248
million US dollars on multilateral aid about half of which goes to the Mercosur and the Inter-
American Development Bank. Brazil has continued to increase its aid budget yearly despite
glaring economic disparities which have occasioned political tensions and underdevelopment in
the country.
Russia
Russia is listed as a transitional country although it does not belong to the category of
development nations. Its 20th Century history still influences the way Russia thinks of itself. Even
to date, it continues to make huge budgetary allocations on its military despite the social tensions
within the federation and challenges arising from the dispute prone Caucasus region. Its most
abundant export commodities include energy, minerals and materials for use in low level
processing. Russia’s economy is not diversified. It has a struggling service sector and majority of
its population is ageing. Nevertheless, Russia’s economy is re-emerging thanks to its efforts in

BRICS 8
development (Keukeleire et al., 2011). As at 2010, its contribution to the Official Development
Assistance (ODA) had risen to 472 million US dollars up from 100 million US dollars in 2004.
Russia extends most of its aid funding to its neighboring Eurasian countries. She has also given
260 million US dollars towards the fight against HIV/AIDS malaria and Tuberculosis in the last
ten years preceding 2012.
India
As at 2005, 4 out of 10 Indians were living on less than a dollar in a day. Of all BRICS
states, India receives the highest allocations of ODA. In 2009, this stood at 2.5 billion US
dollars. India has extended aid assistance to its neighboring countries including Myanmar,
Bangladesh, Nepal, Sri Lanka and the Maldives. In Africa it has had close bilateral relationships
with Mauritius. India as at 2012 had given up to 200 million US dollars to NEPAD initiative
(Walz et al., 2011). India is also engaged in technical assistance in Africa through TEAM-9
Initiative (Techno-Economic Approach for Africa-India Movement) and Pan-African E-Network
Project and the. Between 2009 and 2010, India Foreign Development Budget stood at 700
million US dollars every year.
China
Chinas economy is the second largest in the world (measured by GDP). For 11
consecutive years China’s economy has had a steady economic growth rate of between 8-11%
making it one of the fastest growing economies in the world. China is looking to direct 46% of
its foreign aid to Africa and 33% to Asia. Often, China finances infrastructural projects in the
developing countries which are most of the time paid back in mineral or oil supplies e.g. in

BRICS 9
Angola and DRC. China will advance 13% of its development aid to Latin America. The White
Paper on Chinas foreign aid reports that as at 2009, 161 countries and another 30 international
aid agencies had received significant foreign aid funding from China (Dyer et al., 2011). Chinas’
spending on foreign aid stood at 1.9 billion US dollars in 2009 up from 0.5 billion US dollars in
1999. The government of the People’s Republic of China prefers cooperation in the South-South
Cooperation model usually accompanied by ceremonial symbols. China is also committing
significant resources especially in Africa in the form of 20 year concession loans, interest free
loans and debt relief. It has signed debt relief contrast with over 50 countries in Africa, Latin
America and Asia amounting to 4 billion USD. China also has a prominent stake in foreign
direct investment in Africa.
South Africa
South Africa’s focus of international cooperation is regional security and peace. The
country’s foreign policy objectives pinpoint Africa as the center of its main focus. In 2008 South
Africa spent over half of its aid funding on defense and security interventions in the continent. In
the White Paper in 2011, South Africa has set out to be a leader in the African Union in the areas
of pace keeping, peace building and prevention of conflict as well as post-conflict reconstruction.
In 2011, South Africa committed to make significant aid contributions to DR Congo, Sudan and
the Comoros to fund peace building and reintegration efforts after armed conflict (Ramachandran
et al., 2011) It has also committed to engage with regional institutions such as South African
Development Cooperation (SADC) to contribute to the attainment of peace in the Great Lakes
Region and the Horn of Africa. It is difficult to find any conclusive data on South Africa’s

BRICS 10
foreign aid spending but it could be anywhere from 100 million US dollars to 450 million US
dollars in recent years.
The Rise of BRICS from Developing Countries to Emerging Economies
In the last decade, BRIC have continued to rise in rankings in the world economy. Today,
the five countries contribute a significant share of the global economy. The five countries have
had an impressive progress as measured by the Purchasing Power Parity and their participation in
the Gross National Income (GNI). Of the 5 countries, there are indications that China and India
will continue to expand their share of the global economy (IMF 2011). Brazil’s economy is also
projected to remain stable while that of Russia is foreseen to experience a decline. As BRIC
countries rise in terms of their economies they have also been keen to establish deeper ties with
other development countries. Among the world’s emerging economies, BRICS are major
players in the global economy.
The 5 development protagonist owe this success to 3 main factors; the massive sizes of
their economies, impressive economic growth rates that are sustained and the pursuit of
increased recognition in the structure of global cooperation and trade that is commensurate to
their economic standing. South Africa stands in a unique position among the BRICS. Although a
member country, it does not satisfy much of the criteria that are identifiable in the other 4 BRICS
countries. Its economy is almost insignificant compared to the other 4 countries. Its GDP is even
much smaller. However, South Africa is the Africa’s leading economy and is the only country in
the continent that is listed as belonging to the upper middle income states. Moreover it is the only
country in Africa that has membership in the G 20.

BRICS 11
The most prominent feature of the BRICS is the pursuit of a more balanced
representation at global decision making processes with regards to international development
politics. In the first meeting of BRICS heads of state, they called on the international community
to institute a more democratic world order that takes into account all sates in decision making
organs (De Sousa, Sarah-Lea 2010) The political stance that has been adopted by BRICS has
prompted analysts to speculate that they are seeking to upset the European Union and provide
countering philosophy to that of the US and western donors but more fundamentally BRICS are
champions of the globalization process and are seeking to influence in multilateral economic and
political institutions rather than opposing them.
Although BRICS may not belong to the league of the most successful economies in the
world going by per capita income, thanks to the dynamics of their economies, sheer geographical
sizes and populations, they are impacting heavily on the global governance structure and
international cooperation (World Bank 2011). They are making a case for their relevance by
initiating meetings with institutions of global governance both at the presidential and ministerial
level. Their strategy to achieving this is through the use of multilateral coalitions and South-
South Cooperation. This played out in 2006 during the WTO (World Trade Organization) round
table talks on agricultural subsidies and import taxes held in Geneva. In the failed negotiations,
BRICS took a position favorable of the South-South Cooperation. BRICS have adopted SSC
friendly stances on many issues touching developing countries in a bid to win their support and
hence influence in international development politics.

BRICS 12
Accomplishments of BRICS
As discusses above, the formation of BRICS was to bring the common power of the
members countries together so as to make a competitive advantage against the West countries.
Russia was eyeing to increase the trade across Africa and South America as Brazil and South
Africa needed security and regional development. The following are among the accomplishments
of the BRICs.
Improved Trade
Trade among the nations has been the backbone of the tremendous growth observed in
those nations. The brick group has shown remarkable improvement on the foreign trade
relationship with constant growth rate (Mujica et al., 2014). In the mid-1990s the export growth
rate was about 13.3% and improved to 49.8% in the last ten years, similar, the import rate
among the countries have improved from 13.2% to 47.7% in the respective time frame. The
improved trade among these nations impacted growth of GDP, hence increasing from 9.2% in
the 1980s to 26.6% in 2009.
The import and export steady growth rate has been improving in the past decades have
increased due to the high demand for resources, especially during the Indian and Chinese growth
manufacturing industries. The demand of the raw materials has caused the rise of the prices of
the raw material, oil, higher import fee that benefited countries such as Brazil and Russia as the
past prices of the raw material were used to invest higher processing industries (Wilson, 2015).
Both countries used their expertise to help LICs to escape from the commodity trap to avoid the
Dutch Disease Effects. The transfer of knowledge and technology from one country to another
has helped LLCs countries to establish diversified economies.