The Future BRICS: A Synergistic Economic Alliance or Business as Usual?

219 Pages·2014·0.89 MB·English

by  Rich Marino (auth.)

The Future BRICS
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The Future BRICS
A Synergistic Economic Alliance or
Business as Usual?
Rich Marino
© Rich Marino 2014
Softcover reprint of the hardcover 1st edition 2014 978-1-137-39643-3
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work in accordance with the Copyright, Designs and Patents Act 1988.
First published 2014 by
PALGRAVE MACMILLAN
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registered in England, company number 785998, of Houndmills, Basingstoke,
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Palgrave Macmillan in the US is a division of St Martin’s Press LLC,
175 Fifth Avenue, New York, NY 10010.
Palgrave Macmillan is the global academic imprint of the above companies
and has companies and representatives throughout the world.
Palgrave® and Macmillan® are registered trademarks in the United States,
the United Kingdom, Europe and other countries.
ISBN 978-1-349-48463-8 ISBN 978-1-137-39644-0 (eBook)
DOI 10.1057/9781137396440
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Contents
List of Tables and Figures vi
Acknowledgements ix
Part I BRICS Forum: an Overview
1 Introduction 3
2 The BRICS Forum: an Overview 19
Part II Basel Accords
3 Basel III in Conjunction with Nation-Specific
Regulatory Measures 37
Part III BRICS Macroeconomics
4 Macroeconomics of Brazil 2013–14 57
5 Macroeconomics of Russia 2013–14 72
6 Macroeconomics of India 2013–14 87
7 Macroeconomics of China 2013–14 101
8 Macroeconomics of South Africa 2013–14 116
9 BRICS Countries: Yesterday, Today and Tomorrow 131
Part IV Conclusions
10 Conclusions 151
Notes 196
Index 208
v
List of Tables and Figures
Tables
1.1 Growth post-crisis has been much weaker than
pre-crisis: BRICS without China 7
3.1 Basel III minimum capital ratios and phase-in plans 39
3.2 Pre-crisis and current levels of bank capital 43
3.3 Remaining increases in bank capital ratios 44
3.4 An increase in bank lending spreads relative to a one
percentage point increase in bank capital 46
5.1 Russia’s percentage growth rates 1995–2012 81
7.1 China: imports and exports of base metals in
August 2013 107
9.1 Emerging and frontier markets’ China trade 2000–1
and 2010–11 135
9.2 A partial list of nations included in the World Bank’s
Doing Business reports 139
9.3 Doing Business 2014: BRICS nations rankings for
each measure 140
9.4 Ownership of China’s commercial banks 146
10.1 Examples of the impact of Chinese trade on other nations 158
10.2 India–China bilateral trade 159
10.3 South African trade with China by type of
product 164
10.4 Percentage of Chinese imports relative to total
South African imports (WTO weights) 166
10.5 Comparison of import unit values of key products
imported from China in 2010 168
10.6 Chinese competition and producer price inflation
in South Africa 170
10.7 Industries in which loss to Chinese imports 2001–10
represented more than 10% of 2001 production 171
vi
List of Tables and Figures vii
10.8 China: changes in employment, 1992–2001 and 2001–10 172
10.9 Estimated job losses in South Africa resulting from
increased Chinese import penetration, 2001–10 173
10.10 Regression results for employment and wage models 174
10.11 Simulated impact of Chinese competition on
employment: selected industries 175
10.12 BRICS trade profile (merchandise) 2011 181
10.13 BRICS trade profile (services) 2011 181
10.14 Sector analysis: agriculture 186
10.15 Sector analysis: industry 186
10.16 Sector analysis: services 187
10.17 Tariff profiles 187
10.18 Service sector commitments under GATS 188
10.19 Economic indicators for the BRICS, 2010 190
10.20 Trade indicators for the BRICS 190
10.21 BRICS’ share of world exports and imports of
goods and services, selected years 191
10.22 Share of BRICS economies in global FDI flows,
selected years 191
Figures
4.1 Brazil: GDP growth 60
4.2 Capital flows 66
5.1 Value of Russia’s infrastructure projects, planned and
under construction 83
6.1 Mumbai Sensex 30 days July–August 2013 96
6.2 Emerging market private capital inflows, net 100
7.1 China GDP gr owth 103
7.2 China imports 111
7.3 China exports 111
8.1 South Africa: nonresidents’ purchases/sales of bonds
$ billion, cumulative year to date 119
8.2 South African inflation rate 123
viii List of Tables and Figures
8.3 Global GDP growth: emerging market economies and
advanced economies (percent average annualized) 124
8.4 South Africa: current account deficit 125
8.5 South Africa: exports 127
8.6 South Africa: imports 128
10.1 Brazilian exports to China 152
10.2 Brazilian imports from China 152
10.3 Brazil–China trade 2007–12 154
10.4 Russia: quarterly imports 156
10.5 Russia: quarterly exports 156
10.6 China–South African bilateral trade balance by
weighted WTO end-use classification 163
10.7 Price per unit of Chinese imports relative to imports
from other countries, 2003–9 168
10.8 BRICS nations’ GDP 179
10.9 Trade between Brazil and the other BRICS nations 182
10.10 Trade between Russia and the other BRICS nations 182
10.11 Trade between India and the other BRICS nations 183
10.12 Trade between China and the other BRICS nations 183
10.13 Trade between South Africa and the other
BRICS nations 184
10.14 Exports of goods and services by the BRICS
economies 2000–10 (US$ million) 192
10.15 FDI inflows in the BRICS economies 2000–10
(US$ million) 192
Acknowledgements
Without question, no manuscript can become a book without the sup-
port, encouragement and professional input of others. With that in
mind, I would like to thank my editor Aimee Dibbens, my copyeditor
Keith Povey, Gemma d’Arcy Hughes and all of the Palgrave Macmillan
production team.
In support of my research findings, I would like to thank Maya
Revzina of the World Bank, Enestor Da Rosa Dos Santos Junior of
BBVA Research, Robin Koepke, Kristen Silverberg and Leah Davis of
the Institute of International Finance a nd the Bank for International
Settlements Basel Committee on Banking Supervision.
June 2014 Rich Marino
ix