Book: THE GROWTH MAP : Economic Opportunity in the BRICs and beyond
Author: Jim O’Neill
Introduction: Audacious Growth 1) The Birth of the BRICs 2) From Emerging to Emerged 3) BRIC by BRIC 4) The new Growth Market 5) Are There Enough Resources? 6) Consumption 7) New Allies Ahead 9) Invest and Prosper & Conclusion.
Book was first published in 2011 in support of his research paper that had researched for Goldman Sachs where he was working as a Chief Economic Advisor. This paper is clearly says about the future of the global economy.
China will have the largest economy in the world, the USA second and India will be third by 2035. Brazil, Russia, India and China (BRICs) will be economically most powerful nations by 2050. GES, GSDEER and other economic indicators have been used to measure the economy; says Jim O’Neill in his the best seller The Growth Map.
Jim O’Neill, a PhD economist from the University of Surrey, UK coined the acronym BRICs first from their initials to describe them in 2002 before its inception in 2008 while he was working for Goldman Sachs.
In 2003, by commenting on the research paper (2002) of Jim’s team (P29) Professor Niall Ferguson (Harvard) said ‘‘projections were some of the silliest things he had read (P 83).’’ Later in 2011 Ferguson commented about the book ‘‘There is no better guide to the new map of the economic world than Jim O’Neill. This sharp, shrewd book tells the big story of our time: the fundamental shift of economic power from the West to the Rest’’(back cover)
Regarding Chinese mentality Neill took an example of Byron Wien (Vice chairman of advisory services at the Blackstone Group), who asked a group of Chinese people how they felt about not being able to vote. One of them told him: ’what’s the big deal about voting? In the US everyone can do it and only half of the people do. If voting were that great a thing, like sex for example, everyone would do it’. (p 88)
Jim has rained some words to suggest how to make Chinese closed economy and Indian non governance favourable to all us as well, as these both country are doing their best for themselves, not for the world.
Nowadays, the reliability of the BRICs and its weight has increased. So Indonesian, Mexican and Turkish friends of him asked it should have been BRICI, BRICM and BRICT respectively (P5). In his own words Jim says- I thought the global economy in the coming decades would be propelled by the growth of four populous and economically ambitious countries: Brazil, Russia, India and China (BRIC)
A coincidence was when Jim had been to Everest Base Camp, Nepal via Lukla’s Tenjing Hilary Airport to celebrate their 25th wedding ceremony before some months Lehman Brothers declared itself bankrupt. He found there ‘powerful example of how globalization was alive and well’. But he said nothing more than that about Nepal. In his words ‘‘On our way to Mount Everest we spent a night a night in the Nepalese capital Kathmandu, awaiting the hair-raising flight to Lukla’s Tenjing Hilary Airport’’ (P 1)
He has defined more interestingly about MINT and N-11. Mexico, Indonesia, Nigeria and Turkey are classified as MINT and Mexico, Turkey, Egypt, Iran, Nigeria, Bangladesh, Indonesia, South Korea, Pakistan, Philippines & Vietnam as Next-11 or N11. (P6) He has replaced the term ‘emerging market’ with ‘growth markets’ to represent BRIC.
♦ The acronym was coined by Jim O’Neill in a 2001 paper entitled “Building Better Global Economic BRICs”. The acronym has come into widespread use as a symbol of the apparent shift in global economic power away from the developed G7 economies towards the developing world.
♦ After then, the BRIC was formally announced in Yekaterinburg, Russia on 16th June 2009. Political dialogue between the BRIC (Brazil, Russia, India and China) countries began in New York in September 2006, with a meeting of the BRIC foreign ministers. Four high-level meetings have followed, including a full-scale meeting in Yekaterinburg, Russia, on May 16, 2008.
♦ India and Pakistan might one day be the same as like France and germany; fierce foes in world war II are now partner at the heart of the EU monetary union.
♦ US need to have good relation specially with China and India.
♦ China and India have experienced a chequered relationship… They need to develop a more positive dialogue.
Jim Suggested that- ‘’ Globalization did not need to be Americanisation; there was scope for the rest of the world to create their own definition of the term using their own characteristics’’. He has replaced the term ‘emerging market’ with ‘growth markets’ although some questions were missed to answer.
Can Nepal be benefited from the growth of China and India by the time by sharing its natural resources to increase country’s bargaining power?! Where can we put Nepal in such a powerful growth marathon?!
Or, is the prediction just a random selection of countries which just make up sweet acronyms?
More from the book (2011 first edition, penguin)
P 37 Government role – he says ‘’Government is another obvious factor in a country’s ability to become more productive.’
P 38 GES – he developed model to measure the economy. ( Growth Environment Score, consists of thirteen different variables; five macroeconomic (Inflation, Government deficit, Investment spending, External debt and Degree of openness) in nature and eight micro economic-(use of mobile telephones, use of internets, use of computers, life expectancy, education, rule of law, corruption and stability of government).
Pg 30 Jim developed Goldman Sachs Dynamic Equilibrium Exchange Rate (GSDEER) model, (developed by Jim, P184) to explain how currency move. The model assumes at its basic level that the strength of the currency will reflect its relative purchasing power productivity.
P23 Globalization didn’t need to be Americanization; there was scope for the rest of the world to create their own definition of the trm using their own characteristics.
P32 A growing labour force would be a more important contributor, China and India have half of the world’s population.
P37 Education is perhaps the most important variable in driving the working population to higher productivity
P 32 In the next few decades to 2050 aging population in much of the G7 will pose tremendous social challenge requiring considerable changes: less generous state pension fund provision, longer working hour, and an increase in retirement age.
159-160 American education that is ‘democracy is the only model that can deliver success’ is being challenged the wisdom by China
pg 78 France and germany fierce foes in world war II are now partner at the heart of the EU monetary union. Their intention never fight again … saying regarding India and Pakistan’s relation … india and Pakistan might one day be the same.
P 159 US need to have good relation specially with China and India.
P 160 US politicians need to keep ‘open minds’ in the pursuit of more and freer global trade.
P 162 US and Latin America … security is prime concern.
P 163 US and Russia, in terms of Russia there are three broad issues that matter for the US relationship: Oil, politics, and Europe … since the cold war days the Russian political ideology has been an important topic of the US politics.
160 … It is highly fashionable for US politicians to blame China for America’s economic problem. … these ideas are probably wrong. Many US multinational companies have been at the forefront of helping China export to the US.
A new World order
China will have the largest economy in the world, the USA second and India will be third by 2035. Brazil, Russia, India and China (BRICs) will be economically most powerful nations by 2050.
P 40 by 2010, Brazil became the 7th largest county in the world in terms of economy by overtaking Italy with a GDP of 2.1 trillion.
P 41 Due to massive increasing population, Chinese personal consumption rose by 1.5 trillion between 2001 to 2010. The equivalent of creating another United Kingdom.
P 148 Asia’s centrality to the future of the world economy makes it an obvious place … Japan will be benefited from the market of consumer appliance market, auto to electrical goods …
P 152 China and India have experienced a chequered relationship… They need to develop a more positive dialogue.
P 153 Monetary matter: Asian single currency ‘Acu’ – Asian Currency Union – ACU, like Euro.
 Papers See page 239 of the book
Book Courtesy : Hampshire County Council Library, UK