“New Normal†of the BRICS Economies Regarding Economic Growth and Bilateral Cooperation

The world financial and economic crisis of 2007-2009 continued to manifest itself subsequently with different intensities and revealed a series of vulnerabilities, imbalances, uncertainties and risks at regional and national levels, including BRICS. Although the current phase of economic slowdown in the BRICS countries – including even episodes of recession in Russia and Brazil – is not as severe as were the previous ones, however the overall trend is a long-term slowdown. The current economic situation is due to both cyclical and structural determinants. Among the BRICS, Brazil and South Africa remain the most vulnerable to external and internal shocks. As regards Russia, to the cyclical and structural factors were added specific determinants in March 2014: the Ukraine crisis and the Western sanctions. The sharp drop in crude oil prices worldwide in 2014, associated with structural weaknesses of the Russian economy, highly dependent on energy exports, economic sanctions, the depreciation of the ruble, the erosion of the consumer and investors’ confidence in the economy as well as the increasing costs of the external financing were some of the major determinants which led to the country’s entry into recession in 2015. For India, the international experts estimate that the GDP growth rate surpassed that of China in 2015 and it will remain at a level close to 8% in the following years if the government led by Narendra Modi manages to implement the necessary reform measures. Taking into account the recent developments on a global scale, the widening disparities between the West and the East, we consider that now is the appropriate time for the BRICS to consolidate their cooperation relationship, on the basis of their strengths and complementarities.