Tag Archives: jim o’neill
In these days of high-frequency trading and gargantuan financial sector bailouts, it is more than feasible to suggest the old adage that life imitates art should be substituted by a saying to the effect that life imitates Goldman Sachs. Yet even the global investment banking behemoth may be surprised that an analytical acronym formed by one of their own – Jim O’Neill, presently the Chairman of Asset Management at Goldmans – has transmogrified into a real-life economic grouping: the BRIC countries of Brazil, Russia, India and China, four of the most lucrative and well-endowed emerging markets on the planet. These states held the first BRIC summit at Yekaterinburg in Asian Russia on 16th June 2009, and the second in much-overlooked Brasilia on 16th April 2010.
However, it is the third such meeting – a 14th April 2011 rendezvous in the Chinese tropical resort of Sanya, previously more famous for its connections with Miss World than economic beauty pageants – which may be the most memorable BRIC summit thus far, and for highly questionable reasons: the BRICs abolished themselves, instituting the BRICS in their stead; the Republic of South Africa lays claim to the ‘S’ in the new abbreviation.
While we at Mediolana have nothing against South Africa per se – a banal 2010 FIFA World Cup aside – it is difficult to see what the Rainbow Nation will bring to the BRICS party. While the other four members possess both an incredible abundance of natural resources and consumer markets of enormous absolute size and potential, with a population of around 50 million South Africa is nothing more than a local power in a region ravaged by poverty and AIDS; in a country containing pockets of unfathomable wealth, nearly 43% of South Africans are attempting to get by on a daily income of less than US$2, a reality which severely undermines the country’s credibility on the world stage.
The admission of South Africa into one of the most exclusive economic groupings in the world is a mystery; Mexico, Turkey or Indonesia to name but three countries would have been much more coherent selections. But as well as being a strange choice, it is also potentially a dangerous one: by giving membership to a state which does not ostensibly measure up to any relevant criteria, the BRIC countries risk profoundly damaging the credibility of their own entity. Jim O’Neill’s latest categorisation – the so-called ‘growth markets‘ – does not include South Africa; whether BRICS will revert to its singular form in the future is anyone’s guess.
With the world’s attention focused on the spectacular crumbling of autocracy in Tunisia, it may be difficult for many to believe that a process of potentially even greater long-term significance for the advance of democracy is well underway in the Middle East, and without a bullet being fired: the writing of a new constitution in Turkey.
Turkey has emerged seemingly from nowhere in the last decade to become, in the words of British Prime Minister David Cameron, ‘Europe’s BRIC‘; Cameron’s words seem prescient as Jim O’Neill, the chairman of Goldman Sachs Asset Management who coined the ‘BRIC’ acronym, considers Turkey a member of the ‘growth markets‘ group of countries which is superseding his original neologism. The World Bank estimates that the Turkish economy grew by a stunning 8.1% in recession-soaked 2010, and with impressive infrastructural improvements in evidence in and between major cities throughout Turkey – including the mushrooming of new universities from Istanbul to Erzincan – it is clear that the country is undergoing some kind of transformation.
The Turkish Republic has also undertaken some significant democratic reforms under the ruling Justice and Development Party since the latter swept to office in 2002. These changes have not always proceeded consistently or speedily, but in 2011 the drafting of a new constitution will assume centre stage. Turkey’s Prime Minister Recep Tayyip Erdogan recently stated that constitution would be authored by a broad spectrum of society and that it would be characterised by brevity, accessibility and substantiveness: ‘I envision a short text that targets advanced democracy, that ensures freedoms and fundamental rights and that is understandable.’ Umit Boyner, the charismatic leader of TUSIAD, the main Turkish industrialists’ association, has stated that her organisation will release a report on the deficiencies of Turkish democracy on 1st March; this publication is likely to be highly influential.
These developments are potentially of extraordinary significance. For a variety of cultural and diplomatic reasons, EU candidate Turkey presently possesses tremendous clout in much of the Middle East; if it can adopt a new constitution which is in keeping with democratic best practice, this could well spur publics throughout the region to ask why they are not being afforded the same rights.