Framing “S” in the BRICs of Brazil, Russia, India and China with Poverty and Inequality: the Goldman Sachs Conception versus Practice

Abstract

In 2001 the Goldman Sachs conceived a set of emerging markets of Brazil, Russia, India and China as the future engine of global growth. The global financial crisis in the later years of the twenty-first century heightened the significance of several sets of emerging markets as future global business, financial and investment hubs. Inspired by such conceptions, sets of emerging markets such as the BRICs, the Next-11 and the self-described G5 of “big emerging states” of China, India, Brazil, South Africa and Mexico, characterised as B(R)ICSAM, emerged. Based on the original Goldman Sachs conception, the BRICs of Brazil, Russia, India and China was established in 2009 and the acronym became famous, virtually cajoling South Africa to fervently seek and cede membership thereof in 2011. This article argues that South Africa’s twenty years of economic freedom policies, attendant to enduring poverty and inequality, do not justify the framing of the “S” in the BRICs of Brazil, Russia, India and China. Goldman Sachs’ original conception of the BRICs, which excluded South Africa, forecasts that the set would become the future engine of global growth with the proviso that four core conditions of macro-stability, “good” institutions, openness and education, necessary for rapid growth and attractiveness to foreign investment, are established. This article aims to demonstrate that the framing of “S” in the BRICs to include South Africa, given the founding conceptual rationale for the set and the twenty years of this country’s economic freedom policies, enduring poverty and inequality, means that membership of the set is not a panacea for national development challenges. The article concludes that South Africa’s self-selection of the BRICS membership entails exposure to external vulnerability because the set espouses the economic freedom and openness policies that have been associated with enduring poverty and stark inequality in this country.

DOI: 10.5901/mjss.2014.v5n20p771