For the last few years there’s been considerable talk about the strength of emerging economies, and how they’re the saviour of the world’s economy.
It’s true there has been startling growth in the BRICS economies [Brazil, Russia, India, China, and South Africa]. While I believe this optimism has clouded certain realities about the nature of the societies in those countries, where there remain unresolved huge cultural and structural issues.
As the world’s first post-industrial economy, I think we should be combining that experience with our trading relations. Not in condescending way, but from painful experience. Look back to Victorian times where we overcame pernicious things like child labour exploitation, and developed local government. Education is always part of the answer. Maybe we should think about establishing branches of our colleges and universities overseas, in addition to attracting overseas students here.
Let’s look at each of the BRICS:
- In Brazil growth has stalled, while issues around sanitation, and housing remain unresolved.
- Russia ranks poorly for innovation, and its institutions are sclerotic, although that hasn’t stopped Germany stealing a march on the rest of the western economies in building strong trading relations.
- India’s growth is faltering held back by endemic corruption, bureaucracy and indecision.
- China is hostage to finding employment for its huge population. Maintaining growth is proving difficult.
- Even South Africa provides no rosy outlook. Unemployment blights the economy. Collective bargaining is immature leading to paralysing strikes.
Optimism is fine. Realism is its fairest check.