"The Continued Rise of the BRICS Is Inevitable."
True, but their growth is slowing. Forecasts by Goldman Sachs and others project China will overtake the United States in GDP before 2030. China, meanwhile, dwarfs the other BRICS, whose combined economic size isn't expected to catch up to China during that period. The BRICS will approach the total size of the seven largest developed economies by 2030, and by the middle of this century they are projected to be nearly double the size of the G-7.
BRICS consumers are also beginning to rival their American counterparts in terms of total purchasing power. More cars, cell phones, televisions, refrigerators, and cognac are now sold in China alone than in the United States. Even with slower growth, the economic engine of the BRICS should be more important than that of the United States or the European Union for most of the 21st century.
Then again, there's no guarantee that the BRICS can maintain their torrid growth rates. Just as their expanding economies took the world by surprise over the past decade, the big shock for the next decade may be that they will grow less quickly than assumed. Japan, South Korea, and Taiwan have already shown that growth rates slow down once a basic level of industrialization has been reached. The unquenchable thirst for "goods" tends to moderate when basic infrastructure is in place and consumers want more health care, education, and free time.
To some extent, this is already occurring. Leading Chinese economists now expect China's annual growth to slow down from rates of 10 to 12 percent to 6 to 8 percent by the end of this decade. Dreams of India reaching sustainable annual growth of 8 percent or more have been lowered to 5 to 6 percent after the country hit an inflation barrier and offshore gas production disappointed. Brazil has also struggled to return to its exuberant pre-crisis growth, while Russia has been staggered by Europe's economic problems. The projections by Goldman Sachs and others always expected slower growth for the future, but some enthusiasts did not read the footnotes.
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