Salient to Investors:
Jim O’Neil writes:
In April, the BRICS said they would build their own development bank. Their difficulty in cooperating is simply because they are not very alike.
Brazil, Russia, India and China are the world’s largest emerging economies, while China is bigger than all the others put together – China effectively grows a new India every 2 years, or a new South Africa every few months.
Brazil, India and South Africa are democracies; China and Russia are not. China and India are major commodity importers; Brazil, Russia and South Africa are major commodity exporters.
Russia’s annual per capita income, adjusted for purchasing-power parity, is $24,000 versus $9,000 to $12,000 for Brazil, China and South Africa, and $4,000 for India.
China is the real odd man out, not just because of its size but because it is the only one that so far this decade has met my expectations for growth.
China may see a BRICS bank as a low-risk rehearsal for the role they are fated to play at the IMF and the World Bank, within G-20 and maybe even at the UN.
Nigeria will soon have a bigger economy than South Africa.
Fast-growing emerging economies have rapidly expanding middle classes, who see governments wasting public money on pet projects instead of investment in things that will make them proud and more prosperous, and combat.
Three areas are vital for emerging economies to escape the so-called middle-income traps. Better government not more, education, including at the most basic levels, and access to modern technology.
Read the full article at http://www.bloomberg.com/news/2013-08-05/a-brics-bank-needs-a-sense-of-purpose-to-succeed.html
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