Are the BRICs Still a Bloc?
In the early part of the 2000s, there was much talk of the BRIC countries – Brazil, Russia, India and China. These four markets were seen as rapidly developing examples of smart growth for other emerging economies around the world. Since the Great Recession, however, these four countries have grown at significantly different paces.
China continued to advance during the Great Recession as Brazil, Russia and India all felt its consequences on both their economies and their business travel markets. These three markets rebounded more or less in unison from 2010 through 2013 but then diverged again as India continued its rise while both Russia and Brazil declined.
Brazilian economic challenges led to flattening business travel performance in Brazil through the end of 2013 and into 2014. Brazil continues to face numerous pressures as evidenced by the recently released report sponsored by Visa, GBTA BTI™ Outlook – Brazil 2016 H1 that sees business travel bottoming out in Brazil in 2016 before seeing a slight rebound.
A side-by-side comparison of the BRIC countries highlights the divergence in these important business travel markets over the last few years. Starting in 2005 the four business travel markets paced one another but diverged significantly in 2009 as the Great Recession took full hold of the global economy.
For Brazil to get back on pace with both India and China, it will not only have to dig out of recession, but make significant structural reforms that will allow the economy and Brazilian business travel market the ability to flourish. Coupled with that challenge is the significant investment Brazil still needs to make in its infrastructure ahead of this summer’s Olympic Games, which may or may not be a boon to the country.
Despite how the BRICs have diverged since 2009, China, Brazil and India all still rank in the top ten business travel markets in the world, and there appear to be brighter days ahead. With respect to Brazil in particular, fallout from the current political situation, a rise in commodity prices, and/or a successful summer Olympics could help their economic and business forecasts improve, though these factors all remain unknown at this point. The days of the four BRICs growing in lockstep, however, appear to be over for the moment.