Emerging Powers Eager to Get Down to Business

Rio De Janeiro – Behind every initiative to form an association of nations, there are “strong economic and commercial interests,” said Brazilian Foreign Minister Celso Amorim.

Members of the business communities of Brazil, China, India, Russia and South Africa wasted no time in stating loudly and clearly what they were there for, ahead of the speeches their presidents will deliver at summit meetings this week.

Energy, information technology, infrastructure, food and agribusiness are the sectors that some 400 commercial delegates identified as priorities in terms of business opportunities.

These points of interest were defined at a meeting Wednesday of business leaders from the BRIC (Brazil, Russia, India and China) and IBSA (India, Brazil and South Africa) groups, in which economic statistics mattered more than country initials.

According to documents distributed at the IBSA-BRIC Business Forum in Brasilia, nearly 50 percent of global economic growth between 2000 and 2008 took place in the BRIC nations, and by 2014 this share is expected to reach 61 percent.

Nearly half the world’s population lives in the BRIC countries, which occupy more than one-quarter of the planet’s land area and produce 15 percent of global GDP.

Together, our countries have tremendous strength, said India’s Minister of Commerce and Industry, Anand Sharma, in the upbeat tone shared by all participants.

BRIC and IBSA ensured global recovery from the 2008 recession earlier than expected, he said.

China, India and South Africa are net consumers of energy, while Brazil and Russia are exporters, said Zhang Wei, Vice Chairman of the China Council for Promotion of International Trade (CCPIT).

“We could complement each other” to guarantee, for example, demand and supply “of energy for our countries,” he said.

The Chinese delegate also mentioned other strategic sectors, like grain production to safeguard food security, an equally crucial matter for these emerging countries with large populations.

Zhang proposed a system for exchanging agricultural information between the countries in the groups, to prevent problems like soaring food prices.

According to a report by the Brazilian government’s Institute for Applied Economic Research (IPEA), in the next 50 years the BRIC group of countries could overtake the G6 (France, Germany, Italy, Japan, the United Kingdom and the United States) as the main engines of the global economy.

However, the IPEA report stresses that achieving this will require overcoming structural economic differences between members of the group.

A large share of Brazil’s economy is taken up by consumption in the domestic market, while Russia’s development is based on exports of energy commodities.

India took advantage of a boom in services exports to grow at a high rate and increase its competitiveness in other sectors, while China’s development has been led by exports of manufactured goods and high rates of investment, and its domestic consumer market is undergoing rapid growth, the report says.

These different models of development lead to different patterns of insertion into the world market, according to IPEA. But Sharma said they could do so in an integrated fashion.

The Indian minister said strong points of each country were Brazil’s biofuel development, China’s technology, South Africa’s energy sector, India’s nuclear energy and Russia’s competitiveness in minerals and oil.

“Synergy” was the word chosen by the head of the Department for International Cooperation of Russia’s Chamber of Commerce and Industry, Sergey Vasiliev. “Together, we can only win,” he said.

This was the first time a meeting of business leaders from both groups of countries has been held.

BRIC, an acronym coined in 2001 by economist Jim O’Neill, brings together four emerging countries with large territories and populations, whose economies have grown at impressive rates in recent years.

The India-Brazil-South Africa Dialogue Forum (IBSA), formally established by the Brasilia Declaration in 2003, is a coordinating mechanism to promote dialogue between countries and regions of the global South, and joint cooperation on economic and other issues of international importance.

These groups of countries, according to South Africa’s Minister for Trade and Industry Rob Davies, have brought about a “tectonic change” in the world economic order.

In 2009, China overtook the United States as Brazil’s main trading partner, with 12.9 percent of Brazil’s total foreign trade.

Brazilian exports to China were worth just over 20 billion dollars in 2009, a 23 percent increase on 2008.

And this year, China became the third largest foreign investor in Brazil’s productive sector, in key areas such as oil, metal ores and telecommunications and with future prospects in infrastructure.

These tremendous shifts, according to Foreign Minister Amorim, are tokens of changes in the global balance of economic power that will also be reflected in the world of politics.

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