Goldman Sachs introduced the handy ‘BRIC’ acronym to the world a decade ago as it sought to highlight change in the global economy as Brazil, Russia, India and China grow in economic prominence over the 21st century.
In the decade since, the ‘BRIC’ term has taken on a life of its own, constructing a new geographical image of power and influence as a counterpoint to the traditional ‘West’: the BRICs are seen at the crest of the wave of emerging powers, challenging the dominance of Western Europe and North America in leading and shaping the global system. Academic interest has jumped on this bandwagon too – where the relevance of the BRIC category comes under scrutiny over how much these four large countries actually do have in common. Russia’s place comes with a particular question mark, and Indonesia frequently suggested as a more appropriate replacement.
From another corporate think-tank – the McKinsey Global Institute – comes a breathless endorsement of the African continent’s future potential, and with it, the implicit suggestion that we could be adding an ‘A’ to that acronym. This, of course, depends on seeing the whole region as a single economic unit, so that the numbers of growth, investment and consumption add-up and come close to BRIC territory:
“An even bigger source of growth will be the rise of the urban African consumer. In 1980, just 28 percent of Africans lived in cities. Today, 40 percent of the continent’s 1 billion do, a portion close to China’s, larger than India’s, and likely to keep growing in the coming years. The number of households with discretionary income is projected to grow 50 percent over the next 10 years to 128 million. Already, Africa’s household spending tops $860 billion a year, more than that of India or Russia. And consumer spending in Africa is growing two to three times faster than in the wealthy developed countries and could be worth $1.4 trillion in annual revenue within a decade.”
There’s a bit of food for thought here about the trajectory that Africa finds itself on, at least in economic terms. Urbanization, high returns on investment, untapped agricultural land and natural resources, all adding up, in the McKinsey analysis, to a coming boom. Population alone offers a hint as to the potential here, as competition in Chinese and Indian markets intensifies over the coming years and decades. Someone remarked to me recently that China isn’t going to want to be the workshop of the world forever, relying simply on low-end, labour-intensive industrial production, and someone, somewhere else is going to get a chance to take up the slack.
But despite this proclamation of the ‘African miracle’, a rising tide doesn’t lift all boats if some boats have holes in them or remain anchored to the seabed. The ‘East Asian miracle’ of the 1980s and 1990s was principally based around a few ‘tigers’ – South Korea, Taiwan, and Singapore, and while others in the region also saw rapid rates of growth, economic miracles do not, I would think, take place in a uniform, even manner. Those who are already well-placed to benefit, the existing poles of investment, stable governance and communication, are likely to reap the greatest rewards. Perhaps a more pronounced economic differentiation represents the continent’s future, rather than a wholesale leap into the emerging power class.