The science of growth

Follow the leader

Any fundamental phenomenon requires further study, and in this area the relatively young BRICS is offering researchers a wave of new opportunities. It is like being faced with an almost completely blank page, written upon ever so slightly, while the situation urgently demands that the paper is filled with new information. Currently, this bloc of countries has no clear leader, one who could set a shared course or ideology. While investors can always turn to bank analysts for help, it takes an entirely different set of tools to resolve political challenges. Each of the BRICS members would like to assume the role of leader, and therefore virtually all of them have launched dedicated think tanks, aimed at laying the intellectual foundations for this desirable leadership role. In Russia, this role is fulfilled by the National Committee on BRICS Research (NKI BRICS), which was founded in December 2011. 

BRICS is a huge economic powerhouse. It is one of the levers that push the center of gravity of world economic might towards developing countries

Vyacheslav Nikonov, the executive director, explained why it is needed: “The committee is built to facilitate…the promotion of Russian positions and expert assessments in the international arena, and coordinate the activities of the leading scientific research organizations and experts focused on BRICS” This establishment will support scientific research teams and individuals studying the bloc, and present their results to broad public using mass media and publishing programs. At the end of last year, the leadership of NKI BRICS was elected, and administrative and scientific structures were formed. This included the appointment of a head of the board and the formation of a Scientific Council, which is to include leading economists, political scientists and experts of the Ministry of Foreign Affairs, the Diplomatic Academy and a number of academic institutions of the Russian Academy of Sciences. Yevgeniy Korendyasov, an expert from the NKI BRICS Scientific Council, explained to BRICS Business Magazine the goals envisioned by this body. The key prerogative, in his words, is the development of a research effort strategy, and the coordination of the activities of researchers. In the future, the council will also be able to engage in international cooperation, even beyond the limits of the BRICS countries.

United colors of BRICS

Aside from scientific and analytical work, the Russian NKI is also to perform another, extremely important function. It is responsible for the organization and implementation of conferences and “brain-storming” with the involvement of national committees from other countries. Such events will generate new recommendations in the field of politics, economics, culture and finances for discussion at summits of BRICS member countries. “For example, within this framework, our institute is currently working on a monograph on the problems of interaction between BRICS and Africa, linked to the next summit, which is to take place in March of next year in Durban, South Africa,” notes Korendyasov. Moreover, from April 2012, NKI BRICS began publication of a regular bulletin, which includes information about the most interesting Russian and foreign research.

Each of the BRICS members would like to assume the role of leader, and therefore virtually all of them have launched dedicated think tanks, aimed at laying the intellectual foundations for this desirable leadership role. In Russia, this role is fulfilled by the National Committee on BRICS Research

Obviously, this includes publication of news releases from the committee itself, as well as a review of upcoming events. Other BRICS participants, as we already hinted, already have their own versions of the NKI. In India, this is the Observer Research Foundation, while China has its Chinese Association for International Understanding, and Brazil’s Pontifical Catholic University now boasts a BRICS Policy Center. All of these organizations were created in compliance with agreements, concluded at last year’s April BRICS summit in the Chinese city of Sanya, explains Yevgeniy Korendyasov. “The tasks before them are to study the opportunities and avenues for developing cooperation between BRICS countries, coordinating interaction on the international level, as well as political, economic and cultural rapprochement between these countries,” he explains.

Non-artificial intelligence

The intellectual component will be critical in the development of the BRICS strategy, considers Vyacheslav Nikonov, Chairman of the Board at the Russian think tank. In his opinion, Russian Federation can expect to play a significant role in the development of an ideology and strategy for the development of the bloc. There is already a need to hold international events and research on BRICS with greater frequency, and the bloc is already piquing interest farther abroad. “We can feel that interest — although it is somewhat envious and sensitive — in both the USA and the EU, where people are viewing what is happening with both scepticism and concern,” says Nikonov.

There is no reason to doubt the power of the intellectual fist that was formed to turn BRICS and Russia into a new international centre of power. After planning and executing all these efforts, there is now not much left to be done, other than waiting for the tangible results to appear.

Numbers never lie

In 2001 Jim O’Neill, chief economist at Goldman Sachs, could hardly have believed that the acronym BRIC which he then coined to label the countries with the greatest economic growth potential for the next half-century — Brazil, Russia, India and China—would go on to enjoy such astounding and enduring popularity. It is no secret that for this American bank, this new term became a marketing success story: in the decade following the coinage of the monosyllabic tag, the specially-formed BRIC fund attracted more than $400m. In the same timeframe, financiers and managers across the world managed to attract about $70bn into funds that invest in Brazil, Russia, India, China and South Africa, a country that recently contributed one more letter — S — to the acronym.

Against the legacy of war

“BRICS is a big, even a huge economic powerhouse. It is one of the levers that push the center of gravity of world economic might towards developing countries,” ponders Yevgeniy Korendyasov from the Scientific Council of Russia’s NKI. “Economically strong countries, including BRICS and other developing states, want to convert their economic might into political influence. They are not satisfied with the hopelessly outdated global management system that evolved following the Second World War.

All of this presupposes the enhanced importance of representation of developing countries in general, and BRICS in particular, in all major international organizations,” adds Korendyasov. “These are the ones that exacerbated the issue of UN reform, restructuring the international currency loans system, reviewing the dollar monopoly in international economic relations and the creation of new regional reserve currencies,” he reminds us. “They demand to be represented in the UN Security Council with the rights of permanent members, the broadening of their representation in the IMF and the increase of their quotas in that body, as well as the abrogation of the unwritten rule, that says only Europeans can chair the fund. The same is true for the World Bank.” According to this expert, such problems are also raised with respect to the WTO and all international organizations that perform global management functions.

Playing the club card

BRICS countries make up the core of the G20, which is today the main arena for developing solutions to all of these problems. It is no coincidence that the process of institutionalization was initiated in the margins of the G20, transforming the bloc into a genuine club of leading countries with developing economies, with the full intention of coordinating their actions and jointly defending and promoting their interests in the world.

Russia, which gave the first impulse to form the BRICS as an international, institutional structure, and for which this organization turned into one of the most important areas of foreign policy, had a vested interest in the dynamic development of this format. However, it was equally keen to dictate the direction of development and draft the agenda of this ever more powerful club, yearning to be cast in the role of intellectual leader.