The following material is quoted from Globalsherpa.com.
“The BRIC countries label refers to a select group of four large, developing countries (Brazil, Russia, India and China). The four BRIC countries are distinguished from a host of other promising emerging markets by their demographic and economic potential to rank among the world’s largest and most influential economies in the 21st century (and by having a reasonable chance of realizing that potential). Together, the four original BRIC countries comprise more than 2.8 billion people or 40 percent of the world’s population, cover more than a quarter of the world’s land area over three continents, and account for more than 25 percent of global GDP.
BRIC Countries’ Path to 2050
A country’s population and demographics, among other factors, directly affect the potential size of its economy and its capacity to function as an engine of global economic growth and development. As early as 2003, Goldman Sachs forecasted that China and India would become the first and third largest economies by 2050, with Brazil and Russia capturing the fifth and sixth spots.
Growing BRIC Middle Class
The rapid economic growth and demographics of China and India are expected to give rise to a large middle class whose consumption would help drive the BRICs’ economic development and expansion of the global economy. The increase in the middle class population of the BRIC countries is forecasted to more than double that of the developed G7 economies.”
By 2050, China and India will surpass the United States and European Union by sixty-one percent, that is, the economic production will be $105 billion compared to $65 billion for the US and EU. Brazil and Russia will add another $25 billion to the BRIC economy.
The BRIC plans to base its financial standard on a different currency than the US dollar, which is the global standard today. Further, China and India are investing billions of dollars in science and technology. By 2050, China will invest $20 billion per year. Even if the US wanted to emphasize investment in science and technology, it cannot match these numbers.
It is likely that the US will not be the center of invention and innovation.
There is a danger that the US dollar will deflate in relative value when confronted by BRIC’s enormous growth. Travel and imported goods will be more expensive.
The Trans-Pacific Partnership (TPP) is a massive trade agreement that will benefit corporate investment in the Pacific Rim with less expensive costs and unhindered by many human rights standards. The trade agreement will bind the economies of most Pacific Rim countries to China’s economy – using a different financial standard than the US dollar.
The United States (and the European Union) cannot change the economic tidal wave representing forty percent of the world’s population. Further, the US is in a financial bind caused by the Federal Government’s poor management of the economy. The EU is struggling with a euro that does not have common value across Europe and has not established a powerful central bank to control the euro value.
Knowing all this, one is forced to realize that recovery from disparate income between the rich and poor, thereby reestablishing a strong middle class, will take much longer than we may envision. As the years go by, the dysfunctional Federal Government leaves the Country further behind each year it does nothing about education, investment in leading edge ideas and technology, and revising the tax laws – including corporate loopholes. Still today, the major banks control too much of the economy, earning billions in profit that do not enrich the US economy.
By 2050, there may be more opportunity for manufacturing in the US because the US dollar will have less value internationally. One looks for scraps of hope as the golden age of the United States begins to fade.