There is a new addition to a global summits calendar that already has a surfeit of shindigs.
The leaders of the four Bric nations—Brazil, Russia, India and China—meet this week in the Russian city of Yekaterinburg for their first-ever meeting. Hopes run high. Brazilian President Luiz Inacio Lula da Silva told Reuters that the Bric countries should work together to “change the political and trade geography of the world”.
There is an element of the surreal in this grouping. Unlike other major combinations that meet round the year, the coupling of the four major emerging markets does not come from any natural alignment of economic and political interests. The Bric group is the creation of an investment bank and financial markets.
Illustration: Jayachandran / Mint
The acronym was first mentioned in a report by investment bank Goldman Sachs in 2001. Since then, it has become something of a cliché and many global fund managers see these four markets as a single asset class. The four members of the Bric group currently account for one-sixth of the world economy, but this share will undoubtedly grow as they outperform the world’s major economies, such as the US, Japan and Germany.
Thus, an acronym metamorphosed into a pressure group.
However, the Russia summit has to be watched closely because it marks an important step forward in world affairs. There is now a long-overdue shift in the balance of global power, thanks to the economic crisis that began in the West and then spread around the world, and the Bric meeting has to be seen in that context.
The developing world is being taken more seriously these days. Most of the important talks on how to curb the crisis have taken place under the Group of Twenty, or G-20, umbrella. This group of 20 nations is far more representative of global economic power than the G-8, which is a group of eight rich nations.
The four Bric countries are a subset of the G-20, and do not as yet have the collective power to change policy direction. Nor are their interests aligned on many key issues such as energy security and nuclear non-proliferation: Just think of the tensions between India and China on these two issues. But there are other issues where they do speak in one voice: climate change and reform of the global financial system, for example.
The way ahead for the Bric group will not be a smooth one, given the potential tensions that dwarf those between rich nations such as the US and France which often mar G-8 meetings. But such meetings should take place.
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