When reading this story some might recall recent questions about BRICS, which stressed the differences in development of the BRICS nations and wondered about its long term role.
In the story this phrase jumps out :
BRICS Partnership on New Industrial Revolution
It seems that BRICS is focusing, initially, on Africa and the building of what we have been talking about for a long time – An African Industrial Revolution. It will take the form of transporting Africa from an exporter and source of raw materials, into a modern industrial continent. China has the industrial capability from its 40 year opening up focus on exports, and the BRICS nations have the funds and focus, the strength and the breadth, to use SCO and BRI to back this major global source of growth.
As the world looks forward to a century of new growth from SCO, BRI and BRICS, linking together, it is the background investment in infrastructure that will enable this opening up to take root. BRI is producing the spokes to link the centres of production and enable the new sources of goods to move across continents. BRI produces the high speed transportation, the energy and the telecommunications. SCO and BRICS produce the core regional structures to develop the economic development.
For Western companies the growth that now comes from China – over 30pc of world growth – will be replaced gradually by SCO, BRICS and BRI growth.
It is true that the USA is focusing on tariffs and China and the EU, trying to rebuild its power base, and it will. But in the final analysis it is the Industrial Revolution, starting in Africa and spreading out across a global BRI, that will be the main source of global growth in the second half of this century. In fact probably as early as 2030.
The world is changing and the new structures will lead the changes because they deliver what the developing and developed world need – sustainable growth in developing nations.
The developed nations are so consumed by the vast majority of the world’s debt – over$250 trillion – that growth must come from the developing nations. So yes the USA and the EU can discuss aluminium, steel and car tariffs, but the real source of global growth will come from the new world, and the new sectors.
This is win-win as no one is excluded.
How do Western companies fit into and take key roles in this new world? They have to change their models and their ways. They will have to recreate their 19th century ways of going out and building businesses but with new values and roles. It is as much a mental challenge as a business challenge. Western businesses have great advantages to build new world businesses. They have advanced technology, well-educated staffs, and global instincts. But the globalisation of this century will not be about m and a and creating Western style markets.
It is going to be different and local, and developing countries will increasingly be the source of key capital features. So a new working relationship will emerge. HSBC’s strap line of the world’s local bank was very predictive. It has yet to emerge in new forms