PRESENTED BY:-

MUHAMMAD TAHIR

BRICS

The term BRICS was used for the first time in the Goldman

Sachs report 2003

BRICS is international political organization of leading

emerging economies.

BRICS became a new and promising political-diplomatic entity

ABOUT BRICS

BRICS stands for Brazil, Russia, China, and South Africa.

Basically Established on 16th June 2009

It is the fastest growing and emerging economics

BRICS is the international political organization of leading

emerging economies. Its five members are all developing

industrialized countries

Two main Policies

coordination in multilateral fora, with a focus on economic and political governance

cooperation between members

From ‘BRICs’ to ‘BRICS’

The BRIC became a mechanism through which thecountries can exchange opinions, seek convergence,identify areas of cooperation and influence theinternational agenda.

Officially it was admitted as a BRIC nation on 24December 2010

With the entrance of South Africa, at the 3rd BRICSSummit, in April 2011, the BRIC became BRICS,with capital "S".

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BRICS:

Characteristics

BRICS represent 3 billion people or approximately 46%of the world population & 25% of the world’s landcoverage

Five Nations GDP of US 16.039 trillion, approximately20% of the gross world product & US$4 trillion reserves

China and India-Suppliers of manufactured goods andservices

Brazil, Russia, South Africa- Suppliers of Raw Materials

Challenges Related To Economic And Social Integration

Desire To Make The International Order MoreRepresentative

Possibility Of Cooperation In Many Areas

OBJECTIVE OF

BRICS

To achieve regional development

The BRICS advocating reform of the UN Security Council

The BRICS group acts as a bridge between developed and under developing countries

Developing countries will be able to leverage through NDB and the CRA

To Challenge Western financial institutions like the International Monetary Fund and the World Bank

Economic development

ABOUT THE

BRICS

NATIONSIMF: World Economic

Outlook

BRAZIL

KEY ADVANTAGES :

One of the fastest growing economies in the last Decades

Brazilian economy becoming less dependent on imports

Extremely rich in resources such as coffee, sugarcane, crude

oil and iron etc.

Focus on equitable development has resulted in significant

poverty reduction.

CHALLENGES FOR THE FUTURE:

Overburdened and ineffective judicial system.

Industrial output is weak

RUSSIA

KEY ADVANTAGES:

Russia has capability in high-technology sectors

Accounts for around 20% of the world’s oil and gas reserves

CHALLENGES FOR FUTURE

Labour shortages and poorly developed infrastructure

Corruption

INDIA

KEY ADVANTAGES

1.15 billion people

2nd largest labour force

Approximately 2.5 million college graduates per year

CHALLENGES FOR THE FUTURE

Improving basic educational achievement

Improving infrastructure and electrical capacity

Expanding technology industry

CHINA

KEY ADVANTAGES

Broad expansion of educational achievement

Rapid economic growth

3rd largest country in land size

CHALLENGES FOR THE FUTURE

support to rural areas and less-developed regions

Bank of China sees inflation as a bigger risk

Need to improve the investment

SOUTH AFRICA

KEY ADVANTAGE

The South African economy is now the 23rd largest in the world

Inflation is now below 5% and falling.

25% of goods produced in South Africa for export

CHALLENGES FOR THE FUTURE:

The economy is growing but not fast enough

Lack of skills, particularly in IT.

48% of the population is living below the poverty line

BRICS Summit History 1. Yekaterinburg in Russia Summit (2009)

BRIC nations announced the need for a new global reserve currency

2. Brasilia in Brazil Summit (2010)

Consensus on Reform of financial institutions

3. Sanya China Summit (2011)

Economics, anti-terror law under UN auspices, United Nations Security Council reform

4. New Delhi in India summit (2012)

BRICS development bank proposal by India

5. Durban in South Africa Summit (2013)

Negotiations for setting up the bank

6. Fortaleza in Brazil Summit (2014)

Creation of two NDB with 50$ Billion & CRA with 100$ Billion

7. Ufa in Russia Summit (2015)

Inaugural meetings of the NDB & and open up membership to non-BRICS

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New Development Bank

Formed on July 2014 and came into force in July 2015.

Earlier known as “BRICS Development Bank”.

Headquartere in Shanghai

Unlike the world bank which assigns vote based on capital share,

In the NDB each participant country will be assigned one vote

1st president from India & Chairman of Board of Directors from

Brazil and Chairman of Board of Governors from Russia

NDB is source of rising strength of BRICS & against the

domination of western countries through WORLD BANK & IMF

FINANCIAL STRUCTURE

50$ billion (10$ billion from each country) as initial capital, this capital base to be used for financial infrastructure & sustainable development projects.

100$ billion Contingency Reserve Arrangement(CRA) for liquidity protection of brics countries during Balance of payment problem (BOP). ( 41% china, 18% india,Russia,brazil and 5% south Africa).

At the time of expansion the 55% share of the bank will be held by BRICS countries only.

Developing or less developing countries can also apply for financial assistance.

The Bank shall support public or private projects through loans, guarantees, equity participation and other financial instruments. It shall also cooperate with international organizations and other financial entities

NDB and IMF

1.IMF and World Bank are dominated by U.S and western countries

2. IMF and world bank follows different voting power based on

quota system. Though China is second largest economy after U.S it

has fewer voting rights in NDB.

3. The financial institution created by BRICS will reduce the

importance of US dollar as a global currency and eventually it will

increase importance of Yuan

4. IMF cash assistance program is conditional. If a country's

foreign policy clashes with US then it will be difficult to obtain a

loan.

TARGET SECTORS FOR BRICS TRADE

Manufacturing, services and agriculture

Energy, infrastructure, mining beneficiation and

healthcare

Construction and water provision

The green economy and tourism

Although U.S is greatest economy now but BRICS is ready to challenge the US and west economy and hegemony.

BRICS nations have the potential and resources to form a

powerful economy with greater opportunity’s than any other

nation.

A stronger BRICS can also have more influence in other

multilateral forums such as the WTO world bank etc.

In short, powerful BRICS will cause the world taking

towards multilateral system where balance of power will be enough good for world peace.

CONCLUSION

THANK YOU