Goldman Sachs former chief economist Jim O'Neill coined the term BRIC to describe the emerging markets of Brasil, Russia, India and China in 2001. In 2015 he predicted the bloc was irrelevant, Russia and India would be expelled, and as a political force it would be over by 2019.
Not only did BRICS (now including South Africa) prosper, but in July 2018 celebrated its 10th anniversary with a summit in Johannesburg. Ironically, as the term was first used in a western-centric sense to identify the best investments for US and European banks, the group now reflects moves to a multi-polar economic and political world.
In 2008 BRICS accounted for 15% of global GDP. That now stands at 19%. In the decade after the financial crisis, these countries generated 50% of economic growth. 40% of the world's population live in BRICS nations. Garth Le Pere of Pretoria University says there was "a better sense of direction", "maturation" and "confidence" than ever.
The bloc is not without its problems. The Russian Center for Strategic Assessments and Forecasts noted the wide disparity of general economic indicators as a barrier to future cooperation. Inflation is between 10.9% and 2.6%; unemployment is between 25% and 5%; China and India face over-population, while Russia and South Africa must address under-population. All five countries rank high on global corruption indices.
Nevertheless, the Center adds BRICS is a mechanism for "international cooperation, state planning and market economy, a polycurrency financial system, respecting sovereignty and cultural and civilizational identity". BRICS developed as "the unipolar model is unable to cope with the global office" and does "not suit developing nations".
As a mark of global influence heads of state from Turkey, Argentina, Egypt, Angola and Rwanda attended the summit. Thabi Leoka of Argon Asset Management stated South Africa was also keen to lobby for African nations to participate, and develop China's role in Africa, while not crowding out private investors from the continent.
The Kluchevskoye Gold Mining Project was presented as an example of successful inter-group collaboration. The Indian Sun Gold company worked with China National Gold Group, the Russia Sovereign Investment Fund, the Far East and Baikal Region Development Fund together with private investment and business leaders from Brasil and South Africa to develop gold deposits in the eastern Siberian region of Chita. The project is due to produce 6.5 million tonnes per year.
Iqbal Surve, Chairman of BRICS Business Council said this "can be used as a model to tackle significant projects in non-BRICS countries as well", noting it was a "sustainable model for cooperation, collaboration and investment led economic growth".
Brasil is also looking to increase its role in the group. The country recently had high US tarrifs placed on its steel exports, and risks the EU following suit. Brasil has a well-developed high tech sector which represents a strength among BRICS. Marco Antonio Raupp, director of a San Paulo technology park states "exploring more deeply this collaboration" brings many benefits. While Rodrigo Mendos, its international coordinator added "talent" and "open-minded flexibility" would help all members.
Prime Minister Modi of India was on a "make in India" mission to develop the country's industry, emphasising the many investment opportunities available. Modi stressed the need to create an independent group credit ratings agency, to promote stability, reform and progress in financial markets. India was keen to cultivate the China-Russia axis, as a counterweight to US tariffs and isolationism becoming more "inward looking".
The level of cooperation among BRICS nations in the last decade was clear from the Declaration issued at the end of the summit. Examples of joint projects included the Energy Research Cooperation Platform, the Agricultural Research Platform, customs simplification, tourism initiatives, research and development centres for vaccines, a commitment to a space programme, support for small and micro businesses, a young diplomats forum, a young scientists forum, and the development of blockchain.
A key aim for BRICS members was developing digital technology, "the 4th industrial revolution". The Declaration noted "the dynamic development of BRICS cooperation in science, technology and innovation" and its "special importance to the advancement of our joint work in this area". Joint action was needed with an "emerging mismatch between the new skills demanded by an increasingly technology and knowledge driven global economy and the older skill set of many workers".
BRICS speaks with one voice on many global issues: reform of the UN and the Security Council to give Brazil, India and South Africa a greater role; a genuinely broad international anti-terrorism coalition; an "Afghan-led, Afghan-owned" peace; support for the Iranian nuclear deal; humanitarian solutions in Palestine and the broader Middle East; preventing an arms race in space; support for the World Trade Organisation and a resolution of its Dispute Settlement System impasse. While backing the IMF financial safety net, BRICS sought to develop its own Contingent Reserve Arrangement to assist countries in financial difficulties.
There were no major surprises at the BRICS summit, and the Declaration represented well choreographed diplomacy for a jubilee celebration. Nevertheless the scale of progress is clear. Cyril Prinsloo of the South Africa Institute of International Affairs confirms "cooperation has matured and deepened" with a "unified voice and agenda on key issues impacting not only on BRICS but equally for all countries globally".
Ronnie Lins, director of the China-Brasil Center for Research and Business believes BRICS has "changed the long-standing dominance over the world by developed nations". All this was achieved during the worst global recession since the 1930s. What do the next 10 years have in store?