BRICS – The Acronym

The acronym was coined by Jim O’Neill a Goldman Sachs employee in a 2001 paper entitled “Building Better Global Economic BRICs”. The acronym has come into widespread use as a

symbol of the shift in global economic power away from the developed G7 economies to the developing nations.

Political dialogue between the BRIC countries began in New York in September 2006, with a

meeting of the BRIC foreign ministers. Four high-level meetings followed, including a full-scale meeting in Yekaterinburg, Russia, on May 16, 2008.

The BRIC countries met for their first official summit on 16 June 2009, in Yekaterinburg,

Russia, with Luiz Inácio Lula da Silva, Dmitry Medvedev, Manmohan Singh, and Hu Jintao, the respective leaders of Brazil, Russia, India and China, all attending. The core focus of the summit was related to improving the current global economic situation and discussing how the four

countries can better work together in the future, as well as a more general push to reform financial institutions. There was also discussion surrounding how emerging markets, such as

those members of BRIC, could be better involved in global affairs in the future.

In the aftermath of the summit the BRIC nations suggested that there was a need for a new global reserve currency that is ‘diversified, stable and predictable’. The statement that was released

stopped short of making a direct attack on the perceived ‘dominance’ of the US dollar, something which the Russians have been critical of; however, it still led to a fall in the value of the dollar against other major currencies.

South Africa sought membership during 2010 and the process for formal admission began as

early as August 2010. South Africa was admitted as a member nation on December 24, 2010 after being formally invited by China and the other BRIC countries to join the group. The group

was renamed BRICS to reflect the now-five-nation membership, with an “S” for South Africa appended to the acronym. President Jacob Zuma attended the 2011 BRICS summit in Sanya, Hainan province, China in April 2011 as a full member.

Objective of BRICS nations.1-To achieve regional development 2-To remove trade barriers.3-Economic

development.4-Optimum use of resources.5-Builiding relationship.

As of 2014, the five BRICS countries represent almost 3 billion people, or approximately 40% of the

world population; as all five members are in the top 25 of the world by population, and four are in the

top 10. The five nations have a combined nominal GDP of US$16.039 trillion, equivalent to

approximately 20% of the gross world product, and an estimated US$4 trillion in combined foreign

reserves. The BRICS have received both praise and criticism from numerous commentators. Since 2010,

the BRICS nations have met annually at formal summits. Russia currently holds the chair of the BRICS

group, and will host the group's seventh summit in July 2015

The group signed the long-anticipated document to create the $100 bn BRICS Development Bank and a reserve currency pool worth over another $100 bn. Both will counter the influence of

Western-based lending institutions and the dollar.

The new bank will provide money for infrastructure and development projects in BRICS countries, and unlike the IMF or World Bank, each nation has equal say, regardless of GDP size.

Each BRICS member is expected to put an equal share into establishing the startup capital of $50

billion with a goal to reach $100 billion. The BRICS bank will be headquartered in Shanghai, India will preside as president the first year, and Russia will be the chairman of the

representatives.