The world's key emerging economies are meeting in Russia for their first ever summit. The BRIC nations, made up of Brazil, Russia, India and China, hope the bloc can act to stabilize the global economy.
The BRIC states haven’t come out of the global credit crunch unscathed, but the crisis has been a great time for its members to go shopping abroad.
Last month, Russia bought a slice of Opel, the flagging German car-maker and part of U.S. auto giant General Motors. For many of the 55,000 workers across Europe, the move was seen as a lifeline.
German Foreign Minister Frank Walter Steinmeier welcomed the purchase.
“I think we have found a responsible solution with private investors and interim funding from the state. It is a solution which preserves (Opel's) locations in Germany and also preserves the highest possible numbers of jobs,” Steinmeier said.
Until the crisis struck, Russia was on course to overtake Germany as Europe’s biggest car market. Now it hopes to use Opel’s know-how to boost its car industry.
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But while some Western business giants are sinking, the rising economies are keen to snap up potential bargains.
“Before the crisis Russia and China accumulated big financial reserves. And now there are opportunities to buy great assets at half-price or less. The West has always viewed investments from BRIC countries with caution. But the crisis has forced them to be more flexible,” analyst Aleksander Razuvaev says.
Developed economies need money – the world’s fastest developing economies have it. Russia and Brazil have mentioned offering $10 billion each to the International Monetary Fund. China could invest $50 billion and India may announce similar funding.
“Who could have imagined some 15 years ago that the world financial system would need a helping hand from the countries that used to be seen as under casts?” Tatyana Shaumyan of the Russian Academy of Sciences said.
The four nations have so far been seen as little more than a common interests club. But the time may be right for BRIC to become one of the building blocks of the global economy as it emerges from the downturn.