What are BRICS Countries?
BRICS is an informal group of states comprised of five developing economies. The initial address was as BRIC economies, and with the addition of South Africa, the forum added the letter S, making it “BRICS.” The group now comprises the countries Brazil, Russia, India, China, and South Africa.
The goal of the union is to promote cooperation and dialogue among themselves proactively, pragmatically, incrementally, transparently, and openly. The focus is also on building a peaceful, harmonious world with common prosperity that serves the interests of all the people and nations that belong to it.
Table of contents
- BRICS countries are a multilateral forum initiated by Russia. It was formed in 2006, and the group held its first summit in 2009. It is a union of emerging economies.
- The acronym stands for countries of Brazil, Russia, India, and China. BRIC later transformed it into BRICS countries with the addition of South Africa in 2010.
- It constitutes major developing economies that aim to impact several fields, including energy, environment, international trading, and stabilization. It Promises democratic and diplomatic cooperation, mutual respect, coordinated action, and collective decision-making among the members.
BRICS Countries Explained
BRICS countries list consist of five members. The federative republic of Brazil (B), the Russian Federation (R), the Republic of India (I), the People’s Republic of China (C), and the Republic of South Africa (S). South Africa joined the alliance in 2010. Russia initiated the proposal for multinational cooperation under the leadership of Vladimir Putin in 2006. In 2009, the group held the first summit of the BRIC alliance. The leaders of BRICS countries issued a joint statement about the goals the cooperation wanted to pursue.
It wanted to foster incremental, proactive, pragmatic, open, transparent, and incremental discussion and collaboration among these countries. The BRICS alliance’s meeting and collaboration were for the benefit of all and also to serve the shared interests of emerging market economies and developing countriesDeveloping CountriesA developing economy defines a country with a low human development index, less growth, poor per capita income, and more inclined toward agriculture-based operations rather than industrialization and business.. The group also focuses on constructing a harmonious, peaceful, and prosperous world. Also, the statement offered a shared understanding of the countries’ approaches to addressing the global financial and economic crisis.
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BRICS countries statistics
The cornerstone of BRICS countries’ influence on the international arena is their expanding economic strength and relevance as one of the key driving engines of global economic development. This is precisely the reason why the alliance was made a reality in the first place. Moreover, they contribute to a large population and possess immense natural resources. In 2018, the BRICS countries accounted for roughly 32% of global GDP (in their national currencies’ purchasing power parity numbers). The BRICS countries have a combined population of over 3 billion people (about 42 percent of the world’s total population-2019), spanning about 26 percent of the planet’s surface. Therefore, it was decided that establishing a New Development Bank (often addressed as the BRICS bank) to raise funds for infrastructure and sustainable development projects is essential. This decision was taken to support BRICS and other emerging economies and impoverished countries.
The presidents stated in the Fortaleza Declaration that the New Development Bank (NDB) would improve BRICS cooperation and complement international and regional financial institutionsFinancial InstitutionsFinancial institutions refer to those organizations which provide business services and products related to financial or monetary transactions to their clients. Some of these are banks, NBFCs, investment companies, brokerage firms, insurance companies and trust corporations. ‘ efforts for global development. In other words, it aims to contribute to collective commitments to achieve robust, sustainable, and balanced growth. Following the principles of equality, the forum started the BRICS bank with an initial authorized capital of U.S. $100 billion. The subscribed capital was the U.S. $50 billion, shared equally among the founding members. Russia gave the first chair of the board of governors, and the first chair of the board of directorsBoard Of DirectorsBoard of Directors (BOD) refers to a corporate body comprising a group of elected people who represent the interest of a company’s stockholders. The board forms the top layer of the hierarchy and focuses on ensuring that the company efficiently achieves its goals. was from Brazil. The bank’s first president was from India, and the headquarters were in China (Shanghai). South Africa has the new development bank of Africa’s regional center.
Purpose of BRIC Countries
Leaders of the BRICS economies issued a Joint Statement (Yekaterinburg, Russia, 2009), and it contained the following points:
- Commitment towards reforming international financial institutions. It also aims to find a greater voice for the emerging and developing economies for better representation in those financial institutions.
- To work with the international community to keep the multilateral trading systems stable and improve the international tradeInternational TradeInternational Trade refers to the trading or exchange of goods and or services across international borders. and investment environment.
- To be part of the World Trade Organization’s Doha Development Agenda and the achievement of the Millennium Development Goals through sustainable development, the Rio Declaration, the Agenda for the 21st Century, and multilateral environmental agreements.
- Coordination and cooperation among BRICS states in the field of energy efficiency. Also, concentration on climate change to protect it and fulfill socio-economic development tasks.
- To provide humanitarian assistance and reduce natural disaster risks. This include addressing issues like global food security.
- Cooperation among BRICS states in science and education and engagement in fundamental research and advanced technological development.
- This promises democratic and diplomatic cooperation, mutual respect; coordinated action; and collective decision-making. It also discourages terrorism.
BRICS countries represent a significant percentage of the world’s population and have a Gross Domestic ProductGross Domestic ProductGDP or Gross Domestic Product refers to the monetary measurement of the overall market value of the final output produced within a country over a period. of over 16 trillion U.S. dollars. Therefore, it is technically considered the third giant after the European Union and the United States. Nevertheless, there have been various criticisms arising, and given below are a few:
The dominance of one country:
The growth of China’s economy is tremendous and outweighs the other members’ contributions to the world economy. But unfortunately, this makes the union seem like china with its partners rather than a union that has members with equal powers.
Lack of mutual economic interests:
There has been a decreasing trend of trade happening between the members. But, on the other hand, there are reports that the trade between the members and the E.U. and U.S. is higher, and China’s trade with the rest of the world is even higher in terms of numbers in comparison.
Competition among themselves:
There are markets where the members have equal (almost) influence in the market shareMarket ShareMarket share determines the company's contribution in percentage to the total revenue generated within an industry or market in a certain period. It depicts the company's market position when compared to that of its competitors., such as in the clothing field in China, India, and Brazil. In addition, there are military equipment markets where China, Russia, and Brazil sell products. Research and development results have less impact since these countries can re-engineer and create similar technologies. As a result, there are less cooperation and more competition.
Each member country has different cultures, economies, and rates of economic development. Similarly, the standard of living and the definition of poverty all differ. When there is a lack of understanding of the priorities between these members, there will be no room for sharing useful inputs. In addition, issues are prevailing regarding the term “emerging economies,” as amongst the group, some countries tend to perform better than the rest. However, some have shown no signs of much improvement. To solve the current state of issues, a new idea of BRICS+ countries has been idealized. This is an expansion of the existing forum. Accordingly, the new platform comes with a vision to improve the quality of life of people around the world, including the standards of environmental and other social obligations.
Frequently Asked Questions (FAQs)
BRIC countries are an economic union of countries formed in 2006. It consists of four member countries. The federative republic of brazil (B), the Russian Federation (R), the Republic of India (I), and the People’s Republic of China (C). South Africa joined in 2010 and subsequently came to be known as BRICS.
The basic uniting factor among these nations is that they are all emerging countries. They have a significant share of the world population and trade volume when put together. These countries aim to stabilize trade and international relations and reform international financial institutions.
Marketers shall be aware of these countries as they are large in area, population, and influence. They have a significant share of global trade, and that will have an impact on international relations. Marketers being aware of such facts can influence product placement decisions.
This has been a guide to BRICS Countries and its definition. Here we discuss the purpose & criticism of BRICS countries along with a detailed explanation. You can learn more from the following articles –
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