Ten years ago, Goldman Sachs’ Jim O’Neil brought the four big emerging economies to global attention by coining the term BRICs.
A decade later, and that’s what many in the West are now shitting as they imagine a future where Brazil, China, India and Russia set the international agenda.
It’s hard to remember how novel the BRICs concept was originally. Today you can’t turn on the BBC or read an article about investing without hearing about emerging markets and the growing Chinese middle class gorging itself on meat, Tiffany watches, and over-priced condominiums
Yet just ten years ago the private property market in China essentially didn’t exist! Memories of a botched coup and a financial crisis were still fresh in Russia, while Brazil was in investors’ minds still a banana republic. India was good at cricket.
Have we gone too far the other way? That’s a big topic, but one thing to understand is it’s demographics that underpins the most ambitious claims for the BRICs.
Yes, citizens in the BRICs getting richer, but we will, too. It’s just there’s billions more of them, so overall they’ll eat up more of the pie (on the menu: the world’s fast-diminishing natural resources and biosphere).
According to a new Goldman Sachs report timed to celebrate the anniversary of the BRIC concept, by 2050 the UK will still be the third richest country on a per capita basis out of the BRICS, the N-11 and the G71):
Our future: The world’s Uncle Monty from Withnail and I
Anyone reading (or writing) doom-laden missives about how BRIC growth will mean we’ll all be growing our own carrots and wearing the same hair shirt for 20 years needs to pay attention to this graph, and at least decide why they disagree.
The rise of the East (/South) does not point to poverty in the West (/North).
Crazy rich anglosphere
Don’t celebrate too much, though. While the gloomiest predictions of the fall of the West flounder on poor mathematics, very few are thinking about what it will be like to live in such a world.
Possibly only America will still retain today’s swagger on the global stage, and it could be a very different America to the one we know. Population growth will keep it in contention, and most of that will be Hispanic-speaking.
Will it have the same cultural values as 1950s America? For good or ill, unlikely.
As for Britain, to the average Chinese or Indian teen, we’ll be old fogeys who made history 1,000 years ago – rich and doddering towards the end of the pier.
Think of rich old Colonel Blimps turning out for the Trooping The Colour in London every summer.
Wealthy and with good stories to tell?
Sure. But no longer part of the future.
- Small countries like Norway, Singapore and the oil states will likely be richer on a per capita basis. [↩]
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> at least decide why they disagree.
Peak Oil, and resource crunches. The West could get away with needing more than one earth to support its lifestyle because not the entire earth was living it.
> so overall they’ll eat up more of the pie
which has to come out of the extra bits we were munching… So our material standard of living has to go down. If we are smart, our quality of life might go up, but it would be wise not to count on it!
@ Ermine: Ah, but the pie won’t remain the same size and as developing countries become richer they’ll be able to more easily afford the products and services the West produces.
@ Monnevator: ‘Sure. But no longer part of the future.’ What do you mean? Is this a power and influence thing? What’s wrong with being rich and having a high standard of living? Part of this rich future will, presumably, include being a part of the world’s economy and could include developing new technologies and so be a ‘part of the future’ afterall?
@All — I don’t disagree that in some ways it could be a prosaic but pleasant enough outcome. In fact unlike our gloomy friend Ermine, I see this future as pretty bright.
But think about how Britain has taken 3 generations to get over the loss of Empire (if indeed we actually have yet). Much more change to come.
A few readers have also pointed out via email that I’ve over-simplified in saying Britain will be the third-richest country by capita, as there’s a whole load of countries not included by Goldman Sachs on this graph (oil rich states for instance).
This is a fair cop, I got carried away in making my point and under-caveating my conclusion.
The takeaway remains though that *we* will be plenty rich, if things turn out as expect. But Britain overall as a nation? Not so much.
Just to point out the UK will not be the 3rd richest per capita country. It’s only the third richest included here out of these countries… Norway, Qatar, Saudi, Luxembourg, Switzerland etc. will all be wealthier than the UK on a per capita basis… Sorry to be pedantic but worth pointing out
@Matty — Yep, I oversimplified here as mentioned in the comment above. You’re not being pedantic — on reflection I have amended the copy to repeat what it says in the graph for clarity.