The formerly high growth emerging markets foursome that make up the BRICs—Brazil, Russia, India, and China—are 11 years old and their performance in 2012 was not exceptional.
They have been likened to the Beatles—four disparate individuals that sometimes inspired hysteria—in their enormous success. But their market share has now dwindled from 3% to one-fifth.
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And the performance spread of their gross domestic product (GDP) hovers only about 3 percentage points above that of developed nations.
Between 2000 and 2008, BRICs GDP averaged around 8%. For 2012, the International Monetary Fund (IMF) predicts it will be closer to 4.5%.
The global economic woes of Europe and the US have dragged the average growth rate of these countries from 20% to 30% down to 5% to 10% levels.
Exports from emerging markets will likely shrink, as well. Brazil and Russia are the two BRICs that will be hit hardest because they are huge commodity exporters.
Russian stocks look cheap but the geopolitical forces there make investors uncertain. Brazil has been the hottest story over the last several years but its performance is also fading.
India and China expected to benefit from falling commodity prices but inflation in India remains stubbornly high at 7%. High fiscal deficits of 5% and 6% of GDP are hampering private investments.
China has developed high trade friction with Japan and also with western countries. Its newly installed regime seems to be addressing the issue, calling for a focus on consumer spending to grow the economy.
Each BRIC country is grappling with the need to address its own problems
after having been the darlings of the emerging markets world for over a decade.