BRICS Takes the Lead Over G7 in Global Economic Dominance

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BRICS Takes the Lead Over G7 in Global Economic Dominance

BRICS (Brazil, Russia, India, China and South Africa) is a group of developing countries that came together in 2009 to promote economic and political cooperation. The group is expected to play a more dominant role in the global economy than the G7 countries (Canada, France, Germany, Italy, Japan, the United Kingdom and the United States) by 2028. According to Bloomberg's calculations, the BRICS countries will contribute 35% to global economic growth, while the G7's contribution is expected to fall to 27.8% by that year.

Over the next five years, China is expected to be the main driver of global growth, with a market share twice that of the United States (US). Currently, the BRICS countries already account for 31.5% of global gross domestic product (GDP), while the G7's share has fallen to 30%. It is estimated that by 2030, BRICS will account for more than 50% of global GDP.

On the other hand, India-based Megh Updates, one of the world's largest online information platforms in terms of visitors, also highlighted the same: "By 2030, BRICS is expected to contribute more than 50% to global GDP and is likely to increase further with the proposed expansion plans. Already in 2015, China's economy has surpassed that of the United States in terms of purchasing power parity, indicating significant growth.

A recent report by UNCTAD also showed that the shifting weight of the BRICS economies over the past decade has significantly changed the global economic landscape. According to the World Bank, the BRICS share of global gross domestic product (GDP) has increased from 18 percent in 2010 to 26 percent in 2021, with a steady increase over the period. One of the main drivers of this trend is China's economic growth, which will account for more than 70 percent of BRICS GDP in 2021.

In terms of GDP per capita, the BRICS group has a nominal GDP per capita of $7,666 in 2021, compared to the global GDP per capita of $12,263 in the same year. However, in terms of purchasing power, BRICS average GDP per capita (PPP) is $17,990, close to the global average GDP per capita (PPP) of $18,721.

In terms of trade, the BRICS countries currently account for 18% of total world exports. However, their share of exports is steadily increasing and intra-BRICS export growth is above the global average. This increase in intra-BRICS trade could be evidence that closer economic cooperation is already delivering tangible benefits and is an important driver of investment growth within the bloc.

There seems to be a shift away from the dominance of the United States to the leadership of the major BRICS countries, creating a more balanced multipolar platform. It is as if the BRICS are pushing and demanding reforms in global institutions where they feel underrepresented. This includes efforts to reform the structure of the United Nations, to gain fairer shares in the World Bank and the IMF, and to renew membership and strengthen global bodies such as the WTO and the WHO.

However, the risk of negative economic growth in the BRICS countries still needs to be addressed. The war in Ukraine has affected commodity markets in the short term and potentially in the long term. On the other hand, inflation in BRICS may be harder to control than expected, and tight financial conditions may lead to debt problems for some members of the group.

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