The first decade of the 21st century has been a period of rapid economic growth in many large emerging economies, especially China. While the U.S. and many European economies are weighed down by large sovereign debt and austerity measures that could condemn them to several years of slow growth, many emerging economies are in much better fiscal shape and have recovered quickly from the global recession.

The growing economic and financial momentum of Brazil, Russia, India, China and South Africa, as well as Indonesia, Turkey and South Korea (collectively grouped as ‘BRICS+’ in this study), has Western decisionmakers worried. Spurred inter alia by the organization of annual summits since 2009, a central strategic concern is whether (several of) the emerging economies are likely to coalesce into an economic or political bloc that might become a counterbalance to Western influence in existing economic, financial, and political institutions and promote an alternative agenda. In essence, the emergence of such ‘clubs’ of countries fuels an erosion and fragmentation of global governance. Moreover, the emergence of a bipolar world with ‘the West against the Rest’ could potentially increase the costs of doing business, severely complicate reaching agreement on transnational problems such as climate change, challenge the promotion of Western values and human rights, lead to increased diplomatic or military tensions, and jeopardize the ongoing process of economic globalization.

This study looks specifically at the following key questions:

• In what ways has the rise of emerging economies affected the international power balance?

• To what extent are the emerging economies cooperating strategically on economic, diplomatic, and security matters?

MAIN POWER TRENDS AMONG THE BRICS+

In economic terms, almost all countries in the BRICS+ group grew significantly faster during the 2000s than in the previous decade. Fiscal policies within the BRICS+ countries have greatly improved and the state of their public finances is in most cases better than in the EU or the U.S. The improved financial health of the BRICS+ countries gives them more freedom in selecting their own political and economic priorities (rather than following the ones imposed externally, for example by the International Monetary Fund, IMF) and becoming stewards of their own economic destiny. Military forces have been one of the beneficiaries of increased spending and in some cases the improvement in military capabilities has been rapid and substantial.