Describes the economic growth of world markets (e.g. BRICS and MINT), the growing power of Asian, African and other countries, implications of economic growth for individuals and businesses, and indicators of growth
Theme 4 Topic 1
Growing Economies
Economic Growth of World Markets
Economic growth is measured by changes in GDP (Gross Domestic Product) from one year to the next
Emerging Economy – one with the potential to grow more quickly than more mature markets in terms of
economic growth
BRICS and MINT
Economists group emerging economies together e.g. the MINT economies or the BRICS economies
Brazil Mexico
Russia Indonesia
India Nigeria
China Turkey
South Africa
When an emerging market is expanding incomes tend to rise therefore spending rises especially on income
elastic goods
Despite opportunities for firms to set up or sell to emerging markets there are many other factors to be
considered:
The overall size of the economy
Average incomes
Import restrictions and government regulations
Quality of infrastructure
Different cultures
Growing Economic Power of Asian, African and other countries
The BRICS and MINT economies have become more powerful due to their growth over the past few
year
- China has now overtaken the US as the worlds largest economy
- Instead of making components for non-Chinese firms it is becoming strong in Chinese products
e.g. Lenovo
- China has excellent clusters of suppliers, excellent infrastructure and access to lower labour
throughout South East Asia
- Chinese consumers are spending more each year driving higher demand and local production
Roughly 70% of world GDP growth is likely to come from emerging market economies with China and
India accounting for 40-50%
Brazil Problem = breaking out of middle income band countries
Spends a high % of GDP on education
Middle-range, semi-developed country – 15% working in agriculture
21.4% of population below poverty line
Main economic strengths in commodity production (e.g. coffee, mining) and medium-
level manufacturing e.g. textiles
Outside investments boosted output levels in Brazils car industry
Russia Very low rate of illiteracy – 0.3%
Hugely reliant on commodity production, especially oil and gas
Most of its economic growth is from high oil prices
In past it represented a wonderful market for luxury products – unlikely to recur
India The Indian economy slowed sharply when government anti-inflation policies pushed
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