THE leaders of Brazil, Russia, India and China, the BRIC countries, are  starting today a two-day summit meeting in the Brazilian capital, Brasília. That´s the second time the four developing-market giants hold a summit. The first was in Russia last year. Economic and financial issues Discussions are expected to be held on  the need for changes in global institutions, including the International Monetary Fund (IMF) and the World Bank, and on updating the regulation of financial markets to avoid another global crisis. In Yekaterinburg, 2009, they discussed the possibility of creating a new global reserve currency to replace the dollar.  President Luiz Inacio Lula da Silva is the host of the meeting attended by Chinese President Hu Jintao, Russian President Dmitry Medvedev and Indian Prime Minister Manmohan Singh.

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The question was put by Willian Mathis in a very interesting article posted in Brazzil.com. He says Brazil is possibly one of the globe’s most popular and successful nations, experiencing limited negative impact from the global economic crisis that ravaged Western economies, and having beaten out both Chicago and Tokyo for home field advantage in the 2016 Summer Olympics.

In another  quite revealing article by Sarah Lacy for Tecnocrunch.com,  she says Brazil is sort of a strange country to throw into the “emerging market” category. It’s not a particularly young country like India or Israel, nor is it a country like China or Russia that embraced capitalism fairly recently. Brazil is as old as the US and has had a decently built out infrastructure of things like roads and phone lines for some time.

Yes, it’s a growing country with a young and stabilizing democracy that has a long way to go in terms of technology, modernization and bridging a quality of life between very wealthy and very poor. In that sense, it shares enough in common with emerging markets that Wall Street, at least, tosses it in the “BRIC” bucket. Indeed, Wall Street has had a way bigger crush on Brazil to date than Silicon Valley.

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The heads of state of Brazil, Rússia, India and China will meet again on April 16^th, in Brasília, the Brazilian capital. They first met in the Russian city of Yekaterinburg last year to discuss the international financial crisis. The agenda for the April summit is still being discussed. The meeting comes as Brazil, Latin America’s largest economy, tries to take a more prominent role on the world stage. It has become an important member of the G20 group of nations – now a key forum for global economic and financial discussions. The BRIC group summit will be preceded on April 15th by a meeting of heads of states from Brazil, India and South Africa, also in Brasilia.

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The four members of BRIK: Brazil, Russia, India and China

By Schott´s Vocab – The New York Times

An oil-industry acronym for Brazil, Russia, Iraq, Nigeria and Kazakhstan – five countries predicted to make a significant mark on oil production in the 2010s.

Discussing the possible impact of an increase in oil supply, Liam Denning observed in The Wall Street Journal:

Meanwhile, in a nod to the BRIC countries that helped define the last decade, consultants PFC Energy has coined its own acronym for the next: BRINK, or Brazil, Russia, Iraq, Nigeria and Kazakhstan.

Brazil has hosted a string of big discoveries, while Russia has defied expectations by overtaking Saudi Arabia’s output. Kazakhstan is expanding three major projects, while a tentative peace is allowing Nigeria to start raising output.

The wild card is Iraq, where more licenses for foreign oil companies were awarded Friday. Contract terms encourage firms to maximize output quickly. Winners to date aim to boost output from five fields 12-fold to 8.5 million barrels per day.

Given Iraq’s fragile peace and ravaged infrastructure, that looks unrealistic. But even if production increased by a more conservative 1.5 million barrels per day by 2015, it could pressure oil prices through unsettling the organization Iraq helped found 39 years ago: the Organization of Petroleum Exporting Countries.

(The term BRIC – Brazil, Russia, India, China – seems to have been coined by Goldman Sachs in 2001.)

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Brazil’s official statement, pronounced in the gathering of finance ministers and CB presidents from the world’s 20 top economies in London, defended that emerging nations should play a significantly larger role in economic decisions, “to reflect the changes in the world economy”.

Before the meeting started, Bric countries (Brazil, Russia, India and China)  proposed an agreement in which developed nations would give 7% of their share in IMF and 6% of the share they have of the World Bank. Once this was accepted, developing nations would together detain half of the global amount of shares.

Currently, rich countries have 60% of vote both in IMF and in the World Bank. The battle for vote power is the main topic on Brazil’s agenda for the third G-20 meeting in only ten months.

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The research heard more than 240 multinationals. From these, 50% plan to invest more in 2011 than they have invested in 2008 – between the Asian companies, the number rose to 57% and, between Americans, it achieved 71%.

The result indicates that the process of internationalization will be resumed, yet in a slower and different format where there will be a higher preference for the emerging countries. According to Unctad, the economic crisis gave fresh impetus to this trend. Rich countries will still attract investments, but the role developing countries have will rise in the multinationals’ strategies.

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Launched two weeks ago, a 104-unit residential project directed at middle-income families in Sao Paulo’s Vila Carrao area is the best example of that, Thomas Shapiro, president of GoldenTree InSite Partners, said at the Reuters Global Real Estate Summit. “We sold every unit in four hours,” Shapiro said, adding that the company has recently raised around $500 million to invest there.

When crises arrive, Brazilians traditionally prefer to invest in hard assets

Brazil has kept a low profile internationally in the past few months, he added. That was good for his company to identify good investment opportunities, as local listed real estate companies like Cyrella and Gafisa were suffering with the stock market debacle.

Shapiro said the fundamentals of the Brazilian economy looked better than expected for the year ahead and a stimulus package from the government has helped the real estate market heat up.

He also stated that the upper class in Brazil traditionally prefers to invest in hard assets when crises arrive, but discarded signs of a real estate bubble forming in the South American country, like the one that hit countries like the U.S. and Spain.

High demand in Sao Paulo

Due to a lack of available buildings, it is getting harder to find an apartment or a house to rent in Sao Paulo. In many areas of the city, the number of people searching for a home has more than doubled in some real estate agencies. For low-priced buildings, the waiting time can last four months.

The most sought properties of Sao Paulo have one and two bedrooms, with monthly rent between 1,000 and 1,600 reais – but the increasing demand makes rent prices constantly higher. According a research of the Habitation Syndicate of Sao Paulo (Secovi-SP), rent prices in the city rose around 11,1% between last June and this year’s May.

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With the world’s 10th-biggest economy, Brazil has surpassed the United States as the biggest producer of iron ore and coffee. It’s become the world’s biggest exporter of beef, poultry, biofuels and orange-juice concentrate, and is rapidly gaining in soybeans, corn and pork.

Brazil also has accumulated $200 billion in foreign reserves, almost as much as the rest of Latin America combined. That money will help cushion the global meltdown. Now, Brazil wants to be recognized for its fiscal track record and to avoid the risks that come with a global economic crisis.

“Brazil has new standing in the world,” said Rubens Barbosa, a private consultant in Brazil who’s served as the ambassador to the United States. “We think we can contribute more.” Quietly, Brazil already has become the most powerful country in Latin America.

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