BRIC is an acronym that refers to the fast developing economies of Brazil, Russia, India and China. Jim O'Neill, the Head of Global Economic Research at Goldman Sachs in 2001, first coined the acronym. The original report titled "Dreaming with BRICs: The Path to 2050," predicted that in less than 40 years, the combined economies of these countries would be larger than that of the top six nations today in US dollar terms. It stated, "About two-thirds of the increase in the US dollar GDP from the BRIC nations should come from higher real growth, with the balance through currency appreciation. The BRICs real exchange rates could appreciate by up to 300% over the next 50 years." The report also predicted that China and India will be the dominant global suppliers of manufactured goods and services, while Brazil and Russia would become similarly dominant as suppliers of raw materials. However, with the onset of the ongoing crisis, we saw the phenomenon of `flight to safety' of capital resulting in net outflows from these economies. Doubting Thomases have started questioning the Bric story.

In a recent article, Jim O'Neill has reiterated that BRIC continues to be on solid ground. The latest forecast from Goldman Sachs for growth in the world's Gross Domestic Product is around 0.6% in 2009. Goldman Sachs projects the advanced economies to decline by 1.2%, and so the global growth is derived from the projected GDP growth of 4.7% in BRIC. The BRIC countries will also be the only source of domestic demand growth globally in 2009. Goldman Sachs has forecast that, in 2010, domestic demand growth in advanced economies will recover to 1.2%, while in the BRIC economies, it will accelerate to 7.2%, fueled mainly by China's stimulus. Therefore, coming on top of 2008, Goldman Sachs projects that for three consecutive years there will be global demand expansion led by the BRIC economies. By the end of the decade, they may be close to representing 20% of global GDP. This is dramatically higher than any of the four scenarios considered by Goldman Sachs in 2001. The possibility—envisaged in the original report—of BRIC becoming collectively larger than the G7 by 2035 is becoming more and more real.

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