The Brics acronym was first coined by Goldman Sachs 15 (!) years ago.

The term was used to capture a number of emerging-market economies that included Brazil, Russia, India and China. South Africa joined a year later.

The main idea was that the balance of global growth was moving from the USA, Europe and Japan to these emerging markets. This is where we all needed to be looking for new business.

How’s that worked out for you?

  • China is decelerating rapidly as it attempts to switch from manufacture for export into growth drive by domestic demand.
  • Brazil is in politcal chaos and deep recession
  • Russia’s economy contracted by 4%, due in part to the collapse of energy prices.
  • India has dome reasonably well out of lower energy prices as it is a big consumer.

History is there for a reason. It tells us that emerging economies that grow rapidly for a decade can’t sustain it.

Venezuela was the star of the 1950’s but now is in crisis.

George Osborne, the UK Chancellor, presented a view that the UK economy would contract by 6% in 2030 if the UK exits the EU. It’s a sophisticated analysis.

Trade flows between two countries are proportional to their GDP and the distance between them. This isn’t just economics but Newtonian physics!

Gravitational force is proportional to their mass and the distance between them.

The implications are clear. Our future is with Europe. Like it or lump it.

Large, developed and close-by economies will trade more with each other.