BRIC is an acronym that stands for Brazil, Russia, India, China. In other words, it’s a term used to define and group together the world’s leading emerging economies. BRICS includes all of the aforementioned countries and, in 2010, expanded its definition to include South Africa. Indeed, BRICS countries offer a wide range of different global expansion opportunities that some organizations are unlikely to find anywhere else.
An Overview of BRICS Countries
Analysts have long predicted that the economies of Brazil, Russia, India and China would be among the most dominant in the world by as soon as 2050. in 2010, all five countries were among the fastest-growing emerging markets. But the important thing to note is that this grouping is one based entirely on potential; BRICS is not a political alliance, nor is it any type of formal trade association. Despite no formal alliance, these countries meet often to ensure that each is acting in the interests of other members.
Despite the fact that the combined GDP of BRICS is far larger than analysts originally predicted, there’s still a common perception that the group has failed to live up to its own hype. Many analysts (from the west in particular) continue to highlight the potential weaknesses that seem to be inherent to the group. These include factors like disagreements over the shape that UN Security Council reform should take, significant economic instabilities, among others.
On other metrics, however, BRICS’ appears to be a success. The five countries have a combined GDP of about $18 trillion, roughly 23.2% of the gross world product. They have an estimated $4.46 trillion in combined foreign reserves, and it is expected that they will continue to grow at a rate of about 5.3% over the next few years.
The main long-term goal of BRICS is to help facilitate a much-needed level of cooperation between the member nations for the purposes of development, to better support various projects, to help provide financial assistance, infrastructure development, and more. Many of its short-term agenda goals also related to development. China, for example, provided Russia an opportunity to expand using its One Belt, One Road initiative, otherwise called OBOR. Brazil and South Africa leverage BRICS for regional security and development.
The first official summit was held in 2009 and featured a short declaration that contained 15 identifiable promises. A few years later, that expanded to about 125 promises. The issues discussed involve everything from settling trade disputes to helping to secure countries like Syria.
According to one study, BRICS has a compliance rate of about 77% on average, with China sticking to its own promises the most and South Africa the least. Experts agree that this is roughly on par with the G7 over the same period of time.
The Impact of BRICS Countries
In terms of sheer worldwide impact, BRICS has been a success. Some even go as far as to say that an entire generation of investors and financial institutions have allowed it to change the way they view emerging markets.
Likewise, BRICS countries are attracting a significant amount of investment from all over the world; companies like Nissan and even large media groups like WPP have developed their own unique BRICS business strategies.
Break into BRICS with an Experienced Expansion Partner
While it’s certainly true that expanding into a BRICS member country brings with it a wide range of advantages, it’s also not a situation that one should attempt to go through without a certain degree of planning and preparation. To that end, working with a PEO (Professional Employer Organization) is a viable way for companies to test their expansion and growth potential into BRICS quickly and easily, all while mitigating risks.
Velocity Global’s suite of global expansion services that includes its global Employer of Record solution offer businesses looking to expand overseas the tools and support they need to grow with confidence. Whether you’re considering expanding into a BRICS nation or one of the 185+ countries in which we operate as part of your global expansion, we can help get you there—in as few as 48 hours. Think you’re ready to take on a new international market? Let’s make it happen.