An Overview of the New Emerging Balance of Forces- ‘the BRICS, G 20 and G 7’ Response to the Global Financial Crisis

Journal Title: Asian Economic and Financial Review - Year 2011, Vol 1, Issue 2

Abstract

The USA and the EU economies have just been through a severe recession marked byfinancial turmoil, large-scale destruction of wealth, and declines in industrialproduction and global trade. As the result of reduction in the demand of products in theglobal market, continued falling prices due to lack of demand of their products. TheUSA economy is not competitive now. The current international financial crisis was anexplosion that was the ultimate result of the accumulation of a number of unbalanced,inconsistent and unsustainable factors in the world economy. It is a reflection of thelimitations of the liberal capitalist development concept of Western countries. It alsoshows the dangers of blindly copying the Western development model. The BRICScountries (Brazil, Russia, India, China and South Africa) and the G 20 replacing the G-7 in the wake of the economic crisis, as the premier global forum to deal with thecrisis, reflected a relative decline in the power of the US and other advanced capitalistcountries. The BRICS can represent the interests of all the developing countries. TheBRICS countries are not only the emerging largest economies but its growing strongeconomic and political relationship with the African, Latin American and Asiancountries; it may change in the international economic order through using commoncurrency in trade, sharing their own science and technology to improve and transformin agriculture, energy, and industrial sectors, and establishing a new military block sothey can provide security from the imperialist aggression. Of course, China would beas backbone of the BRICS.

Authors and Affiliations

Akhilesh Chandra Prabhakar| Assistant Professor in International Economics, Debre Berhan University, Ethiopia. Email: [email protected]

Keywords

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