[View the story "Rise of the Global South" on Storify ]Rise of the Global South As economic power shifts to the developing world, will politics follow? Storified by The Stream · Tue, Aug 14 2012 11:17:17
The distinction between the Global North and Global South is not a regional divide, as much as a socio-economic or political one. The divide reflects disparities in political and purchasing power between the North and the South, which encompasses subgroups such as Brazil, Russia, India and China - collectively known as the
BRIC countries - and the
'Next Eleven' economies.
Wikimedia CommonsAJstream
These Global South countries - also referred to as emerging markets - have
maintained steady economic growth for the last decade. In 2008, emerging markets' GDP growth surpassed that of the Global North to make up over 50 per cent of the global sum. The subsequent increase in consumption of commodities and commercial products by these emerging markets reflected the positive GDP growth and economic development.
Additionally, these countries became more connected to the global economy through increased investments and trade.
Emerging economies economist.com/videoeconomistmagazine
The forthcoming 2012 UN Development Programme's (UNDP) Human Development
Report will focus on the strong showing made by economies of the Global South. The UNDP has
expressed hope that these countries' innovations in investment, production, and trade will lead to a more balanced and democratic form of globalisation.
Global - The BRIC opportunityjoneslanglasalle
The BRICs have long been considered leaders of the Global South economies. The graphic below shows that, even amidst the 2009 financial crisis, BRIC nations saw positive growth in GDP:
The EconomistAJstream
In recent years though, African countries have seen some of the largest climbs.
According to The Economist, for the past decade, a majority of the world's fastest-growing economies were in African countries. More African economies are expected to rise in the immediate future:
The EconomistAJstream
African countries benefited directly from the commodity boom of the last decade. The resulting increase in revenues from natural resources occurred alongside a ten-fold increase in foreign investment.
The EconomistAJstream
BRIC countries have come forward as major financiers for economic and infrastructure development projects in other emerging markets, such as in Africa.
According to China's minister of commerce, Chen Deming, China's direct investment in Africa reached $14.7 billion by the end of 2011.
Ian Bremmer discusses China's role in African and Latin American Developmentfpa1918
Other BRIC countries have taken the lead on African and Latin American investment, competing directly with China for these market opportunities. Some have even
framed Brazil as an 'anti-China' investor option for African countries.
Below, the World Bank and the Brazilian Institute for Applied Economic Research
outline the cultural and economic arguments in favour of Brazilian investment in sub-Saharan Africa:
Brazil and Sub-Saharan Africa: Partnering for Growthworldbank
Some worry that the stratification of the BRIC countries from other emerging economies simply perpetuates existing economic systems of dependence. Instead, organisations like the
Transnational Institute argue for mutually beneficial, regionalised trade partnerships.
Global Crises, Regional Solutionstransnationalinst
Let Africa Trade With Africaworldbank
Organisations have launched "South-South" cooperation as well as triangular trade and financing programmes in an effort to employ a more sustainable and equitable economic development model. Such programmes pair countries with comparable economies into trade and investment partnerships. The projects are sometimes backed by a third, wealthier financier economy. In 2011, The UN Environment Programme launched its own
South-South Exchange Cooperation Mechanism to coordinate news and updates about these bilateral partnerships.
Individual financing and development organisations have also developed South-South cooperation programmes. The clip below, from
Fundecooperación , details the triangular development programme between Bhutan and Costa Rica, financed by the Netherlands:
Bhutan and South-South Cooperationfundecooperacion
Still, some economists are reticent to call the rise of the Global South countries the new economic reality. In a July 2012
article , The Economist magazine expressed concern over the recent slowdown shown among the BRIC countries:
The EconomistAJstream
The article goes on to argue that the rise of these emerging markets may have been "steroid-driven":
One performance-enhancer was China’s appetite for raw materials, which created a commodity boom that supercharged many emerging markets. As that boom subsides, Russia’s dependence on oil and gas makes it particularly vulnerable. Another drug was domestic credit, in particular in Brazil, Turkey and eastern Europe.Emerging markets: The great slowdown | The Economist
Dani Rodrik of Harvard University's Kennedy School
added that these commodity booms were no replacement for manufacturing and investment in human capital, which was stunted by large economic players:
Manufacturing enables rapid catch-up because it is relatively easy to copy and implement foreign production technologies, even in poor countries that suffer from multiple disadvantages. Remarkably, my research shows that manufacturing industries tend to close the gap with the technology frontier at the rate of about 3% per year regardless of policies, institutions, or geography. Consequently, countries that are able to transform farmers into factory workers reap a huge growth bonus."No More Growth Miracles" by Dani Rodrik | Project Syndicate
globalization in general, and the rise of China in particular, has greatly increased competition on world markets, making it difficult for newcomers to make space for themselves. Although Chinese labor is becoming more expensive, China remains a formidable competitor for any country contemplating entry into manufactures. CommentsMoreover, rich countries are unlikely to be as permissive towards industrialization policies as they were in the past."No More Growth Miracles" by Dani Rodrik | Project Syndicate
