g4 countries

G4 COUNTRIES

Presented By:-Mriganka Chakraborty(46)

Section- B

Business Environment (CP-208) 2


INTRODUCTION

• The G4 is an alliance among Brazil, Germany, India, and Japan for the purpose of supporting each other’s bids for permanent seats on the United Nations Security Council. Unlike the G8 (formerly known as G7), where the common denominator is the economy and long-term political motives, the G4's primary aim is the permanent member seats on the UN Security Council. However, the G4's bid is often opposed by certain countries.


CONTD..

• In economics, BRIC is a grouping acronym that refers to the countries of Brazil, Russia, India and China, which are all deemed to be at a similar stage of newly advanced economic development. It is typically rendered as "the BRICs" or "the BRIC countries" or "the BRIC economies" or alternatively as the "Big Four".


CONTD…

• The acronym was coined by Jim O'Neill in a 2001 paper entitled "Building Better Global Economic BRICs". The acronym has come into widespread use as a symbol of the shift in global economic power away from the developed G8 economies towards the developing world. It is estimated that BRIC economies will overtake G8 economies by 2027.


CONTD..

• According to a paper published in 2005, Mexico and South Korea were the only other countries comparable to the BRICs, but their economies were excluded initially because they were considered already more developed, as they were already members of the OECD. The same creator of the term "BRICS", has recently coined the term MIKT that includes Mexico and (South) Korea.


CONTD..

• Goldman Sachs has argued that, since the four BRIC countries are developing rapidly, by 2050 their combined economies could eclipse the combined economies of the current richest countries of the world. These four countries, combined, currently account for more than a quarter of the world's land area and more than 40% of the world's population.


BACKGROUND

• The UN currently has five permanent members with veto powers in the Security Council: the People's Republic of China, France, Russian Federation, the United Kingdom, and the United States. The G4 nations are regularly elected to two-year terms on the Security Council by their respective groups: in the 24-year period from 1987 to 2010, Japan was elected for five terms, Brazil for five terms, Germany for four terms and India for two terms.

• According to the IMF, by 2015 all nine economies with the highest GDP in the world will be either members of G4 or the UN Permanent Council


HISTORY

• Some of these sources claim that President Vladimir Putin of Russia was the driving force behind this original cooperative coalition of developing BRIC countries. However, thus far, no text has been made public of any formal agreement to which all four BRIC states are signatories. This does not mean, however, that they have not reached a multitude of bilateral or even quadrilateral agreements. Evidence of agreements of this type is abundant and is available on the foreign ministry websites of each of the four countries. Trilateral agreements and frameworks made among the BRICs include the Shanghai Cooperation Organization (member states include Russia and China, observers include India) and the IBSA Trilateral Forum, which unites Brazil, India, and South Africa in annual dialogues.


TRENDS

• In the revised 2007 figures, based on increased and sustaining growth, more inflows into foreign direct investment, Goldman Sachs predicts that "from 2007 to 2020, India's GDP per capita in US$ terms will quadruple", and that the Indian economy will surpass the United States (in US$) by 2043.


CONTD..

• According to a 2010 report from Goldman Sachs, China might surpass the US in equity market capitalization terms by 2030 and become the single largest equity market in the world. By 2020, America's GDP might be only slightly larger than China's GDP. Together, the four BRICs may account for 41% of the world's market capitalization by 2030, the report said.


CONTD..

• In late 2010, China surpassed Japan's GDP for the first time, with China's GDP standing at $5.88 trillion compared to Japan's $5.47 trillion. China thus became the world's second-largest economy after the United States.


STATISTICS


PROJECTED GDP GROWTH


ACTIVITIES

• The G4 suggested that two African nations, in addition to themselves, be included in the enlarged UNSC. In several conferences during the summer of 2005, the African Union was unable to agree on two nominees: Egypt, Nigeria and South Africa all lay claim to a permanent African UNSC seat.

• A UN General Assembly in September 2005 marked the 60th anniversary of the UN and the members were to decide on a number of necessary reforms—including the enlarged SC. However the unwillingness to find a negotiable position stopped even the most urgent reforms; the September 2005 General Assembly was a setback for the UN.


PROPOSED INCLUSIONS

• Mexico and South Korea are currently the world's 13th and 15th largest by nominal GDP, just behind the BRIC and G7 economies, while both are experiencing rapid GDP growth of 5% every year, a figure comparable to Brazil from the original BRICs. Jim O'Neill, expert from the same bank and creator of the economic thesis, stated that in 2001 when the paper was created, it did not consider Mexico, but today it has been included because the country is experiencing the same factors that the other countries first included present. While South Korea was not originally included in the BRICs, recent solid economic growth led to Goldman Sachs proposing to add Mexico and South Korea to the BRICs


OPPOSITIONS

• Countries that strongly oppose the G4 countries' bids have formed the Uniting for Consensus movement, or the Coffee Club. The leaders of this group are Italy, South Korea, Mexico, Argentina and Pakistan. In East Asia, both China and South Korea heavily oppose Japan's bid.

• In Latin America, Argentina, Colombia and Mexico are opposing a seat for Brazil. In South Asia, Pakistan is opposing India's bid. Also important are historical political animosities toward Japan and Germany whose governments were implicated in several crimes against humanity during the Second World War.


CRITICISMS

• A criticism is that the BRIC projections are based on the assumptions that resources are limitless and endlessly available when needed. In reality, many important resources currently necessary to sustain economic growth, such as oil, natural gas, coal, other fossil fuels, and uranium might soon experience a peak in production before enough renewable energy can be developed and commercialized, which might result in slower economic growth than anticipated, thus throwing off the projections and their dates.


CONCLUSION

• The economic emergence of the BRICs will have unpredictable consequences for the global environment. Indeed, proponents of a set carrying capacity for the Earth may argue that, given current technology, there is a finite limit to how much the BRICs can develop before exceeding the ability of the global economy to supply


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g4 countries

Documents

goldman sachs

business environment

security council

united states

south africa

bric economies

south korea

combined economies