A New Economic Era: BRICS Takes Center Stage
Thriving urban landscapes and monetary ventures proliferate globally
BRICS and its associates are no longer just observers on the global economic stage, they're now the main players, as quoted by Maxim Oreshkin. This shift resembles the economic cycles that have steered growth since the mid-20th century, from the Marshall Plan for post-war recovery in Europe to Japan's economic miracle. But this time, it's different - it's about multipolarity and questioning the traditional western-dominated systems.
Let's look at Oreshkin's analogy: the Marshall Plan, Japan's post-war growth, and the more recent rise of newly industrialized nations. Each wave, he notes, has similarities, but each is also unique due to the unique institutions of the time, including technological achievements, trade systems, and investment mechanisms.
Fast forward to today, and BRICS is the driving force behind the latest economic cycle. With a share in the world economy that surpasses even the G7 grouping, BRICS boasts rapid growing markets and high urbanization potential. And just like before, each wave (or cycle) requires the right combination of circumstances for it to thrive - the right technology, trade, and financial systems, and effective investment mechanisms.
BRICS, as Oreshkin points out, is stepping up traditionally led by the US, Europe, and Japan. China leads in robotics, artificial intelligence, and electronics; India in software development and fintech; and Russia in energy and unmanned technologies.
Speaking of urbanization, Oreshkin believes that countries like Ethiopia, Nigeria, and Pakistan, along with India (which is yet to reach 40% urbanization despite its high economic growth rates), present significant opportunities for investment in large infrastructure projects. Russia, China (with its "One Belt, One Road" initiative), and other global players are already on it.
"Russia is implementing its large-scale infrastructure projects and is involved in global ones," Oreshkin said, highlighting the development of the Northern Sea Route and the renovation of 200 cities as some of the initiatives.
BRICS vs. The West: A Tech Race
A conversation with Ekaterina Novikova, associate professor at Plekhanov Russian University of Economics, reveals a tech race between BRICS and the US. Data suggests that while the US boasts around 5,000 data processing centers, BRICS countries have around a thousand - yet, China alone has surpassed the US in the number of AI patents. This shift was unimaginable just a decade ago.
Washington's response? Imposing tariffs to force developers to relocate to the US. The same strategy is employed when trying to "take" all technologies from Europe. The goal, as Novikova sees it, is to prevent BRICS countries from becoming a superpower bloc that can dictate its terms and rules to the rest of the world.
But it's not all smooth sailing for BRICS. According to Anton Tabakh, chief economist at Expert RA rating agency, questions remain about how this development will continue under different economic conditions. He raises concerns about poverty, low human capital quality, accumulated financial problems, the "middle-income trap," and poor demographics in certain BRICS countries.
A New Era of Global Growth
Mikhail Rasstrigin, first deputy director general of the Center for Strategic Research, believes that BRICS countries will be the main driver of global economic growth over the next decade. Not only will their combined contribution to global development surpass that of the G7, but their total GDP is forecasted to overtake G7's by 2045.
In summary, the BRICS economic cycle represents a multipolar challenge to traditional western-dominated systems, characterized by de-dollarization initiatives, alternative financial architectures, and an emphasis on South-South cooperation. If successfully navigated, this new economic cycle has the potential to reshape the global landscape for years to come.
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- Maxim Oreshkin, in his analogy, pointed out that BRICS is the driving force behind the latest economic cycle, similar to the Marshall Plan, Japan's post-war growth, and the rise of newly industrialized nations.
- In the tech race between BRICS and the US, China alone has surpassed the US in the number of AI patents, while BRICS countries combined have around a thousand data processing centers.
- Mikhail Rasstrigin believes that BRICS countries will be the main driver of global economic growth over the next decade, with their total GDP forecasted to overtake G7's by 2045.
- As Russia steps up with its large-scale infrastructure projects and global involvement, the presidential finance minister, Maxim Oreshkin, emphasized that Russia is implementing its infrastructure projects, such as the development of the Northern Sea Route and the renovation of 200 cities.
