BRICS and MINT: what the labels group, and why they are contested

Overview

Where each label came from, what the countries in it have in common, and why grouping them as one economic story is contested.

What you need to know

Answer each one before you reveal it.

Questions from this subtopic

Each one with the model answer underneath.

1. 1

   What does BRICS stand for, and where did the term come from?

   Model answer

   Brazil, Russia, India, China and South Africa. The original acronym BRIC, without South Africa, was coined in 2001 by Jim O'Neill, an economist at the investment bank Goldman Sachs, in a paper arguing that these four large economies would grow to dominate world output over the following decades and that investors and international institutions should take them seriously. The four countries later turned the label into an actual political grouping, holding their first summit in 2009. South Africa was invited to join in 2010, making the acronym BRICS.

2. 2

   What does MINT stand for, and where did that term come from?

   Model answer

   Mexico, Indonesia, Nigeria and Turkey. The acronym originated with a fund management company and was popularised in 2014 by Jim O'Neill, the same economist who devised BRIC, who presented them as the next tier of large emerging economies likely to follow the BRICS. Unlike BRICS, MINT has never become a political grouping: the four countries hold no summits and have no shared institutions. It remains purely an analytical and investment label.

3. 3

   What do the BRICS countries have in common?

   Model answer

   They are all very large in population or territory or both, giving them big domestic markets and substantial labour forces. All have significant natural resources. All grew considerably faster than the MEDC average during the 2000s and raised their share of world output and trade. All are regional powers with political influence beyond their borders, and all are members of the G20. Since 2009 they have also had a genuine institutional existence, holding annual summits and establishing the New Development Bank in 2014 as an alternative source of infrastructure finance to the World Bank. Further countries have since been admitted to the grouping, which has widened it well beyond the original five.

4. 4

   What do the MINT countries have in common?

   Model answer

   Large populations with a young age structure, giving each a growing workforce and an expanding consumer market. Favourable locations for trade: Mexico shares a border with the United States, Turkey sits between Europe, the Middle East and central Asia, Indonesia lies on the main Asian shipping routes, and Nigeria is the largest market in West Africa. All but Turkey are significant commodity exporters, Mexico of oil and silver, Indonesia of coal and palm oil, and Nigeria of oil. All have growing manufacturing or service sectors alongside those commodities, and all had, at the time the label was coined, the prospect of a demographic dividend as their working-age populations expanded relative to dependants.

5. 5

   Why is the BRICS grouping contested?

   Model answer

   Because it began as an investment bank's acronym rather than as a geographical, cultural or economic category, and the members have little in common beyond size. Russia was already industrialised in the Soviet era, exports oil and gas rather than manufactures, and has a shrinking, ageing population, which is the opposite of the demographic position of India or Nigeria. China's rise has been built on manufacturing exports on a scale nothing else compares with. India's growth has been led by services and information technology with a much weaker manufacturing base. Brazil and South Africa depend heavily on commodity exports. South Africa's economy is a small fraction of China's and has grown slowly, so its inclusion was a political decision to give the group an African member rather than an economic one. Their national interests also conflict, notably between China and India. And the recent admission of further members underlines that this is a political club, not a fixed economic class.

6. 6

   Why is it a mistake to treat BRICS as a single economic story?

   Model answer

   Because the countries grew for different reasons, face different constraints and have followed different trajectories, so any single explanation will be wrong about most of them. China grew through manufacturing, state-directed investment and export-led industrialisation; India through services, IT and a domestic market opened up in 1991; Russia and Brazil largely through commodity exports during a price boom; South Africa through minerals, with growth well below the others throughout. Their paths then diverged sharply: after around 2013, as commodity prices fell, Brazil and Russia entered recession while China and India continued to grow, so that by then Brazil's and Russia's growth rates had far more in common with each other than with either of the Asian members. An answer that explains 'BRICS growth' as one phenomenon, with one set of drivers, cannot account for that divergence; the correct approach is to identify the drivers that apply in each country and note which are shared.

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