Leaders of the BRIC countries (Brazil, Russia, India and China) met last week in Russia for the first-ever summit between the leaders of these emerging-market giants. While trade between the four nations is not large enough to warrant a new trade bloc, they do share common interests in global trade that they might address more effectively as a group. The reported topic of this first set of meetings included a move to decrease the role of the US dollar in global commerce.
The combined strength of these economies is considerable. Already, they represent 15% of global GDP and 43% of the world's population. They also hold 40% of the world's gold and hard currency reserves. More importantly, these countries' annual GDP growth rates are forecasted to be double that of developed countries over the next five years. China is expected to overtake the US soon as the number-one consumer in the world, while India's rural market is an example of resilience and growth in the face of the global economic crisis. It is no wonder that global retailers are placing big bets in emerging markets, with much focus on the BRIC countries. The growing maturity of these economies is also hastening the emergence of a host of homegrown companies able to compete outside their home market.
For global businesses, the BRIC countries are an essential factor - as a group and individually - when setting growth strategies. Moreover, the large firms based in these countries are quickly becoming formidable competitors, as they grab up land and businesses in smaller emerging-market countries. Multinational corporations in developed nations would do well to broaden their BRIC country analyses to include the market opportunity and emerging competition in these geographies.