During the preparation of the prior post a couple of noteworthy items came to light. This post will document them.

The ten highest income countries in 2023 measured by GDP per capita expressed in terms of Purchasing Power Parity (think of The Economist Magazine’s Big Mac Index) were five small Boutique countries producing high valued specialized products including financial and tax avoidance services and three niche economies reliant on the production of a narrow range high valued products including petrochemicals. The United States was the only country in the top ten with a large diversified economy. See Figure 1.

Other than the United States, the top ten counties include Luxembourg, Singapore, Ireland, Macao SAR, China, Norway, Switzerland, Brunei Darussalam and United Arab Emirates.

The BRICS

The Brazil, Russia, India, China and later South Africa were identified by Goldman Sachs at the turn of the century as having the potential to dominate the global economy by 2050. The group of BRICS countries has grown and expanded as an organization. At the midpoint on the journey to 2050 Figure 2 suggests that the journey for the original members has not been smooth. The Russian economy collapsed, recovered and is now stagnant. Brazil and South Africa have stagnated. China has demonstrated strong sustained growth thorough out the first quarter of the century and India also demonstrated sustained growth but at a much lower rate.

The BRICS were an artificial construct by a consulting company but one with enough substance that it has been embraced by the global community and given a formal administrative structure. It is neither a success nor a failure. Rather it is a concept which may provide impetus and leadership for economic cooperation and progress in the future.

Comments:

1. The United States is the only top ten economy with a diversified, large economy. All the remaining nine economies are small and highly specialized, some in services and others in resource production.
2. The BRICS were originally seen as the future of the global economy. But some have fallen backwards and others have stagnated. A couple are proceeding towards a wealthier economy. The lesson is that in spite of the forces within an economy driving towards growth, growth is not guaranteed.