Ranking the World's Economies -
And Why the BRIC Countries Matter
And Why the BRIC Countries Matter
Vol. 8, No. 1
January 21, 2010
September 2008 rattled the world in ways similar to 9/11 - leaving people around the world thinking, "Will the world ever again be the same?" Questions could not be avoided about a reshuffling of the global economic order, and the feeling that none of us was truly safe from financial destruction.
© Copyright - Thomson Reuters 2010
At roughly the beginning of 9/08, the ranking of the top 10 world economies, based on GDP (Global Domestic Production, the total of goods and services produced in that year by that country) were:
Sources: IMF / International Monetary Fund; the World Bank. The GDP cited is the average of the calculation by the IMF and the World Bank. Since the IMF and the World Bank calculate the GDP differently, the ranking of Russia, Spain and Brazil is somewhat different on their separate lists.
Most of us hear of GDP, but rarely hear it explicitly defined. According to the US Bureau of Economic Analysis (BEA), the official definition of "GDP" (Gross Domestic Product) is "the output of goods and services produced by labor and property located in the [country of origin, for example, in the] US."
Some of these economies have weathered the global economic turmoil in ways that were not expected.
Specific attention has been given over the last few years to the economies of Brazil, Russia, India and China / PRC, simply referred to as "BRIC." The BRIC designation was initially conceived by Goldman Sachs in 2001, and aimed specifically at these specific economies - identified as "developing economies" - as potential powerhouses based on their rates of growth.
Why do the BRIC countries continue to fare well in the face of global economic ups and downs? Simply put - size and economic diversity. The BRIC countries are large in terms of land mass and in terms of population. All four BRIC countries are attractive as sources of raw materials, as producers and as potential markets for foreign businesses. In addition, various, special programs are available in the BRIC countries to assist companies seeking or pursuing trade opportunities within their borders. All the BRIC countries have available human resources, ready and willing to work.
In the case of Brazil, it has numerous assets: mineral resources as well as timber and newly discovered petroleum reserves; human resources; and a diversified economy, ranging from agriculture to aerospace. In the case of Russia, it has tremendous mineral resources (including iron ore, gold and diamonds) as well as petroleum and natural gas, a vast land mass and a market hungry for products. In the case of India, it has natural resources such as iron and coal, tremendous engineering capability, tourist attractions and great tourism potential, and vast labor resources. In the case of China / PRC, it has a booming manufacturing sector, a strong services sector, enormous labor resources and a supportive government willing to assist companies entering China.
To encourage exploration of trade opportunities in the BRIC countries, attached are "Fast Facts" as to each of these countries. These summaries provide a basic overview of the various BRIC countries, their economies and other relevant details that might be of interest to a company anywhere in the world: Opportunity always carries with it an element of risk. Trade barriers exist for each of the BRIC countries. Those barriers include: language (Portuguese / Brazil, Russian (including various dialects) / Russia, and Chinese (Mandarin + Cantonese) / China), bureaucracy, logistics, cultural standards and corruption.
Global trade is not a philosophy or a plan; it is a 21st Century reality. The more you know, before you enter a new marketplace, the greater your chances of success. It is good to know critical background information, before you jump in the water. Then it is good to know your corporate partners, managers, and other team members - just in case you need to know if they would help save you from drowning.
© Copyright - Smith Brandon International, Inc.
© Copyright - Thomson Reuters 2010 Click For Restrictions
© Copyright - Thomson Reuters 2010
At roughly the beginning of 9/08, the ranking of the top 10 world economies, based on GDP (Global Domestic Production, the total of goods and services produced in that year by that country) were:
- United States - US $ 14.329 trillion
- Japan - US $ 4.910 trillion
- China / PRC - US $ 4.327 trillion
- Germany - US $ 3.663 trillion
- France - US $ 2.860 trillion
- United Kingdom - US $ 2.663 trillion
- Italy - US $ 2.303 trillion
- Russia - US $ 1.642 trillion
- Spain - US $ 1.603 trillion
- Brazil - US $ 1.593 trillion
Sources: IMF / International Monetary Fund; the World Bank. The GDP cited is the average of the calculation by the IMF and the World Bank. Since the IMF and the World Bank calculate the GDP differently, the ranking of Russia, Spain and Brazil is somewhat different on their separate lists.
Most of us hear of GDP, but rarely hear it explicitly defined. According to the US Bureau of Economic Analysis (BEA), the official definition of "GDP" (Gross Domestic Product) is "the output of goods and services produced by labor and property located in the [country of origin, for example, in the] US."
Some of these economies have weathered the global economic turmoil in ways that were not expected.
Specific attention has been given over the last few years to the economies of Brazil, Russia, India and China / PRC, simply referred to as "BRIC." The BRIC designation was initially conceived by Goldman Sachs in 2001, and aimed specifically at these specific economies - identified as "developing economies" - as potential powerhouses based on their rates of growth.
Why do the BRIC countries continue to fare well in the face of global economic ups and downs? Simply put - size and economic diversity. The BRIC countries are large in terms of land mass and in terms of population. All four BRIC countries are attractive as sources of raw materials, as producers and as potential markets for foreign businesses. In addition, various, special programs are available in the BRIC countries to assist companies seeking or pursuing trade opportunities within their borders. All the BRIC countries have available human resources, ready and willing to work.
In the case of Brazil, it has numerous assets: mineral resources as well as timber and newly discovered petroleum reserves; human resources; and a diversified economy, ranging from agriculture to aerospace. In the case of Russia, it has tremendous mineral resources (including iron ore, gold and diamonds) as well as petroleum and natural gas, a vast land mass and a market hungry for products. In the case of India, it has natural resources such as iron and coal, tremendous engineering capability, tourist attractions and great tourism potential, and vast labor resources. In the case of China / PRC, it has a booming manufacturing sector, a strong services sector, enormous labor resources and a supportive government willing to assist companies entering China.
To encourage exploration of trade opportunities in the BRIC countries, attached are "Fast Facts" as to each of these countries. These summaries provide a basic overview of the various BRIC countries, their economies and other relevant details that might be of interest to a company anywhere in the world: Opportunity always carries with it an element of risk. Trade barriers exist for each of the BRIC countries. Those barriers include: language (Portuguese / Brazil, Russian (including various dialects) / Russia, and Chinese (Mandarin + Cantonese) / China), bureaucracy, logistics, cultural standards and corruption.
Global trade is not a philosophy or a plan; it is a 21st Century reality. The more you know, before you enter a new marketplace, the greater your chances of success. It is good to know critical background information, before you jump in the water. Then it is good to know your corporate partners, managers, and other team members - just in case you need to know if they would help save you from drowning.
© Copyright - Smith Brandon International, Inc.
© Copyright - Thomson Reuters 2010 Click For Restrictions
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