The previously confident, almost boastful bloc of nations known as the BRICs (Brazil, Russia, India and China and recently added South Africa) seem to be making a lot less credible noise at its latest annual summit involving leaders. At least one expert believes it’s foretelling the reality that the bloc was an unnatural fit from the start, and more are coming to that realization.
News coming out of the BRICs meeting has not featured much in the way of firm policy being made other than the establishment of a $100 billion foreign currency pool to shield member nations from wild currency valuation swings caused by other nations struggling with recession or economic malaise. What was expected to be the big news heading into the meeting was a firm agreement to establish a BRICs development bank, one designed to challenge traditional economic powerhouses like the International Monetary Fund. However, reports indicate that some major obstacles have impeded a functional agreement between the BRICs themselves.
Octávio Aronis, an attorney with Brazilian law firm Aronis Advogados with deep involvement in credit and collections, characterized the BRICs as not being a real member bloc in their actions: "...We are all so completely different from each other. They’re four or five countries that are growing, but all with situations and numbers." It's similar to the context of a February NACM interview with Ludovic Subran, chief economist at Euler Hermes, Subran questioning how wise it is to consider them as a grouping or bloc given the many massive differences.
-Brian Shappell, CBA, NACM staff writer
See extended version of this story with more analysis in this week's edition of NACM eNews, available Thursday afternoon via email and at www.nacm.org in the "Resources" pulldown menu.