Allen Lane, £25

Breakout Nations, By Ruchir Sharma

It's not just China and Brazil: from Mexico to Korea, the big beasts of tomorrow's world are already roaring.

The story hits the headlines every day. How China has become the world's second largest economy. How Tata of India has rescued Jaguar Land-Rover. How Russian money has transformed British football. And so on. It is a story of a shift of power away from the so-called advanced world to what has been dubbed the emerging world, or the BRIC countries, Goldman Sachs's acronym for the four largest such economies: Brazil, Russia, India and China.

There has even been a BRICS summit, with South Africa forming the "S". The shift has become so familiar that it is hard to remember that 20 years ago these countries played a modest role in the world economy, aside from reports about economic disasters and the need for aid relief. Now it seems likely that within another 20 years China will have passed the US to become the world's largest economy (it is already the world's largest car market) and India will have become number three. It is an astounding turnabout of fortune.

Yet we know little about it. We lump together countries that are utterly different, not just in their political systems – contrast the four

BRICs – but in the structure of their economies, their policies, and indeed their prospects. That clever acronym diverts our attention from the other powerful middle-income economies, such as Mexico, Indonesia and Turkey, and the African giant, Nigeria. What we need is a primer to guide us. That is the core contribution of Ruchir Sharma's thoughtful analysis of these nations: what they are doing, why they are different, their prospects, their achievements, their errors, and the threats they face.

He starts, as one must, with China. For anyone who has been to China recently and particularly anyone who knew it even a decade ago, the story will be a familiar one: the helter-skelter race for growth, the wealth this has brought to the new middle class, the self-confidence generated by this achievement, but also the human and environmental costs of untrammelled growth – the swagger and the squalor. But this race for growth will come to an end as China's population ages and as development reaches a natural plateau.

Sharma brings out very well the need for the country to become more "normal", with slower growth and more consumption, spreading the fruits of growth more widely. It will still become the world's largest economy but may be an easier bedfellow for the rest of us. "A slower China means a less disruptive China, producing less geographical friction, fewer trade battles, and less fear of a rising 'Red Dragon'. So perhaps this is not a bad thing."

Sharma's day job is head of emerging markets at Morgan Stanley Investment Management, so his focus is that of a potential investor, rather than a political analyst. That means he is particularly interested not just in the pace of wealth creation but also in the quality of governance.

Investors want to make a good return on their investment but they will only be able to if the country has a functioning legal system and the political stability associated with the need to see that wealth spreads down the line. So he is reasonably positive about India, bar its crony capitalism and official corruption: "no other large economy has so many stars aligned in its favour". He is more concerned about Brazil, given its bumpy record of economic management; and he is very critical of Russia, in particular the way it has failed to build a substantial middle class.

There are a series of snapshots about the other important emerging economies, in which he makes a series of sensible judgements. His gold medal goes to South Korea, the "Germany of Asia", in particular for the way it has become a manufacturing powerhouse in one generation and managed to turn adversity to advantage. In the Asian financial crisis of 1998, it had to go to the IMF for a bail-out loan. But it used this crisis to reorganise its industry, allowing many weaker companies to go under or be taken over, and by the middle of 2001 had repaid the debt. Sharma believes South Korea will manage a successful unification with the North.

He is intrigued by Africa, in particular by South Africa and Nigeria; by Turkey; by Indonesia; and by emerging Eastern Europe. These are snapshots, but thoughtful ones that enable one to calibrate ones own views and expectations.

A big message? Well, not really, because there is no magic wand that creates sustainable growth, and we should recognise that much of what is happening is catch-up. He wisely notes: "All the hottest new things, from tablet PCs to cloud computing to social networking, are emanating largely from the United States." But this is a great road-map to the new and better-balanced world in which we will all live, and an encouraging one.

Suggested Topics
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Arts and Entertainment

ebooksNow available in paperback
Arts and Entertainment

ebooks
Arts and Entertainment
Mark, Katie and Sanjay in The Apprentice boardroom
TV
Arts and Entertainment

Film The critics but sneer but these unfashionable festive films are our favourites

Arts and Entertainment
Frances O'Connor and James Nesbitt in 'The Missing'

TV We're so close to knowing what happened to Oliver Hughes, but a last-minute bluff crushes expectations

Arts and Entertainment
Joey Essex will be hitting the slopes for series two of The Jump

TV

Who is taking the plunge?
Arts and Entertainment
Katy Perry as an Ancient Egyptian princess in her latest music video for 'Dark Horse'

music
Arts and Entertainment
Dame Judi Dench, as M in Skyfall

film
Arts and Entertainment
Morrissey, 1988

TV
Arts and Entertainment
William Pooley from Suffolk is flying out to Free Town, Sierra Leone, to continue working in health centres to fight Ebola after surviving the disease himself

music
Arts and Entertainment
The Newsroom creator Aaron Sorkin

TV
Arts and Entertainment
Matt Berry (centre), the star of Channel 4 sitcom 'Toast of London'

TVA disappointingly dull denouement
Arts and Entertainment
Tales from the cryptanalyst: Benedict Cumberbatch in 'The Imitation Game'

film
Arts and Entertainment
Pixie Lott has been voted off Strictly Come Dancing 2014

Strictly
Latest stories from i100
Have you tried new the Independent Digital Edition apps?

ES Rentals

    Independent Dating
    and  

    By clicking 'Search' you
    are agreeing to our
    Terms of Use.

    Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

    Jeb Bush vs Hillary Clinton

    Karen Tumulty explores the power dynamics of the two first families
    Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

    Stockholm is rivalling Silicon Valley

    The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
    Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

    Crucified Santa: Urban myth refuses to die

    The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
    Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

    The Boy in the Dress: On set with the stars

    Walliams' story about a boy who goes to school in a dress will be shown this Christmas
    La Famille Bélier is being touted as this year's Amelie - so why are many in the deaf community outraged by it?

    Deaf community outraged by La Famille Bélier

    The new film tells the story of a deaf-mute farming family and is being touted as this year's Amelie
    10 best high-end laptops

    10 best high-end laptops

    From lightweight and zippy devices to gaming beasts, we test the latest in top-spec portable computers
    Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

    Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

    The batsman has grown disillusioned after England’s Ashes debacle and allegations linking him to the Pietersen affair
    Susie Wolff: A driving force in battle for equality behind the wheel

    Susie Wolff: A driving force in battle for equality behind the wheel

    The Williams driver has had plenty of doubters, but hopes she will be judged by her ability in the cockpit
    Adam Gemili interview: 'No abs Adam' plans to muscle in on Usain Bolt's turf

    'No abs Adam' plans to muscle in on Usain Bolt's turf

    After a year touched by tragedy, Adam Gemili wants to become the sixth Briton to run a sub-10sec 100m
    Calls for a military mental health 'quality mark'

    Homeless Veterans campaign

    Expert calls for military mental health 'quality mark'
    Racton Man: Analysis shows famous skeleton was a 6ft Bronze Age superman

    Meet Racton Man

    Analysis shows famous skeleton was a 6ft Bronze Age superman
    Garden Bridge: St Paul’s adds to £175m project’s troubled waters

    Garden Bridge

    St Paul’s adds to £175m project’s troubled waters
    Stuff your own Christmas mouse ornament: An evening class in taxidermy with a festive feel

    Stuff your own Christmas mouse ornament

    An evening class in taxidermy with a festive feel
    Joint Enterprise: The legal doctrine which critics say has caused hundreds of miscarriages of justice

    Joint Enterprise

    The legal doctrine which critics say has caused hundreds of miscarriages of justice
    Freud and Eros: Love, Lust and Longing at the Freud Museum: Objects of Desire

    Freud and Eros

    Love, Lust and Longing at the Freud Museum