Brazil, Russia, India, China and South Africa: in a word, 'BRICS'. Five Countries across four continents, different territories and economies which today represent 43% of the world's population and 26% of the Gross World Product.
They are emerging Countries, though they remain aware of being the new economic powers with which Western Countries must engage within the global market. And what the BRICS are asking of advanced economies is to have their importance recognised. During the fourth summit of the BRICS, held in New Delhi on 29th March 2012, the heads of state of Brazil, Russia, India, China and South Africa highlighted their desire to join forces and unite their expertise in order to achieve important goals in the fields of industry, employment and social development. They also clearly emphasised the need to have greater weight on the international tables, such as to ensure the representation of the new markets.
Nevertheless, the BRICS are not the only Countries to represent the hub of economic development; other Countries may be counted among this group of emerging States: Countries of North Africa, rocked by the serious popular revolts of 2011 which sparked new paths to growth; Arab Countries overlooking the Gulf, which are rich in energy resources and are attempting to release their national economies from the grip of oil; South-East Asia and the Countries of Latin America, which are rapidly increasing their wealth.
The shifting of the focal point of global economic and business interests began many decades ago, gradually moving from the Atlantic to the Pacific. Over recent years this dynamic has become increasingly strong, reinforced by accelerated growth within emerging Countries, thus exposing new Mediterranean realities, born out of the destruction of the old regimes and as a result of the relative stagnation of highly-developed nations.
With regard to Western economies, emerging Countries offer up some very interesting opportunities: they will in fact become important markets and, for a Country such as Italy that is blessed with a strong 'brand' (the 'made in Italy'), new development scenarios are opening up. Veneto adds greater flexibility to the brand of 'made in Italy', capable of continually adapting to new consumer models.
It is precisely these new consumers which represent the focal point upon which the re-launch of economy must be directed. For years, emerging Countries have only been considered in production terms: low production costs, scarce social security and less stringent legislation encouraged many local entrepreneurs to relocate abroad, in order to combat production costs. At present, different opportunities are opening up: emerging Countries are developing into a pool of new consumers on which to invest. In social and demographic terms, these Countries are mainly characterised by three features: their populations are numerous, young and growing, both from a cultural point of view and with regard to economic opportunities. They are thus more disposed towards consumption, allowing the 'made in Italy' brand to earn a significant slice of the market.
It is however worth remembering the importance that the middle classes can acquire in only a few years. They require products and services of a reasonable price, simple and of high quality, such as, for example, smaller and less aesthetically pleasing fridges, detergents and shampoos which come in smaller, perhaps single dose packages, scooters and motorbikes at a low price without fashionable accessories. In short, they require that range of products which, stripped of the indispensable frills of the West, can help the populations of emerging Countries to live better. This particular market appears to be designed specifically for the dynamism, flexibility and creativity of the small businesses of Veneto.

Economic development

In 1991, the Gross Domestic Product of the BRICS represented 16% of Gross World Product; in 2010 it represented 26%, and in 2017, according to estimates by the International Monetary Fund, it will represent 32%. These three simple facts are sufficient to describe the past, present and future role of the BRICS; enough to make us wonder if the title 'emerging' may now be replaced with 'emerged economies'. India and China are certainly playing the most important role and represent the driving force behind the global economy: according to the most recent estimates of the IMF, in 2017 the weight of China, in terms of Gross Domestic Product, will in fact exceed that of the United States.
The growth of GDP in the BRICS over recent years has followed a very different logic from that of advanced economies. Since 2003, the percentage change in Chinese Gross Domestic Product has grown in double figures (+10% in 2003 and 2004, 14% in 2007); in India and Russia, during the pre-crisis period, growth was between 7% and 10%; South Africa and Brazil are maintaining lower levels, though they are registering growth rates equal to 6%. The economic crisis affected the BRICS as well, but at a different level of intensity. China and India simply witnessed slower growth, however Gross Domestic Product continued to increase at a rate of between 6% and 11%. Brazil, South Africa and, above all, Russia went into negative figures and in 2010 all of the Countries had recovered a part of the loss registered in the previous year, demonstrating an ability for recovery unknown to Western economies.
The economies of the BRICS are also characterised by a strong tendency towards investment: in 2010, China invested 48% of GDP, India 36%, Brazil and Russia 20-21%. For comparison purposes, the United States invested 16% of GDP and Italy 20%. The predictions for the coming years show further increases for Brazil, Russia and South Africa and relative stagnation for India and China.
The economic significance of the BRICS also arises from their role in global trade. Since 2002, the value of trade exchanges has grown significantly, such that China has become first in the rankings in terms of the global exportation of goods and second in the rankings in terms of imports, after the United States. Overall, the BRICS initiate 16% of global exports and 15% of imports. These values become even more important when compared to those recorded at the start of the new millennium: over the course of a decade, the weight of BRICS in world business has more than doubled, moving from 7% to 16% for exports, and from 6% to 15% for imports.
Aside from international goods-related business, the BRICS Countries are also expanding in terms of foreign trade in the field of services. China and India are again the driving force behind emerging economies: if in 2000 China was 13th in the rankings of Countries exporting services, in 2010 it became fourth, while India went from 25th position to 7th position. At the same time, China is third in the rankings of importing Countries (it was tenth in 2000) and India is seventh. Overall, the BRICS are responsible for 10% of service exportations and 13% of imports (Figure 14.1.1)

Demographic development

Almost three billion people live in the BRICS, the equivalent of 43% of the world's population. The true force behind these Countries is precisely human potential. These are young populations who have, over the past years, seen an improvement in their quality of life and have gradually abandoned rural areas, moving to live in increasingly urbanised areas. In a short time, they have become the new consumers to whom Western markets should turn in order to earn a sizeable slice of the market.
Over recent years, the BRICS have witnessed periods of significant demographic development, such as to push several governments to introduce birth containment policies. This has led to a decline in growth, even if the trend is still positive. China surely represents one of the most important examples. At the beginning of the Fifties, the annual growth rate of the population was equal to 2%, approaching 3% between 1965 and 1970 following a baby boom. With the subsequent introduction of a more rigid family planning policy, the average number of children per woman fell from 6.1 in 1950 to 1.6 in 2010 and the annual growth rate of the population began to slow down, reaching 0.5% between 2005 and 2010. According to estimates from the United Nations, the Chinese population will continue to grow until 2020-25, exceeding 1 billion 395 million inhabitants, before it stagnates and eventually falls.
In India in 2010 the population exceeded 1 billion 200 million, in 2050 it will approach 1 billion 700 million. India has without doubt the highest growth rate of all the BRICS. As in China, birth control policies were introduced in the Country from the Fifties which foresaw both an awareness campaign and an actual sterilisation campaign. Still today, the average number of children per woman remains around three and the government continues to incentivise small families via economic support.
In South Africa, the growth rate of the population began to slow down from the 1990s onwards, following a rapid drop in birth rates. Latest estimates nevertheless predict that over the next 40 years, the population will continue to maintain a positive growth rate. In Brazil too, the drop in birth rates has been very rapid: from 6 children per woman in 1950 to 1.9 in 2010, a value lower than the replacement level of two children per woman. This phenomenon has led to a significant reduction in the annual growth rate, despite the fact that in 2010 Brazil was still among the BRICS Countries with the highest demographic development after India.
In this context, evolution of Russia appears to be definitely different: following the fall of the USSR, the economy of the Country went through a period of strong contraction that worsened the people's living conditions. At the end of the '80s life expectation at birth was close to 70 years, whereas at the beginning of the new millennium it was below 65 years. The population therefore has quickly decreased in number, loosing around 6 million people in fifteen years (Figure 14.1.2).
These different growth trends lead to peculiar demographic population structures regarding gender and age. India and South Africa, for example, present classic pyramidal structures: the proportion of young people is very high, to the detriment of the proportion of elderly individuals. Brazil too displays a more or less young population, despite its population structure, which is approaching that of Western Countries, is characterised by a higher percentage of middle aged people and a limited number of young people.
Very different, on the other hand, are the structures of China and Russia, which are in constant evolution. The demographic structure of China reflects the family control policies introduced in order to contain population growth: the most populated age group is between 35 and 45 years old, corresponding to the baby boomers of the Seventies. Following birth control policies, younger age groups are less populated, with a mild recovery in the 20-24 band: born in the Nineties, these individuals were born when the family control policies were loosened, allowing couples to have a second child.
The demographic structure of Russia instead reflects the demographic drop which occurred as a result of the worsening quality of life which followed World War II and the subsequent fall of the Soviet Union.
Another phenomenon common to all the BRICS is rapid urbanisation. In 1950, 12% of Chinese people and 17% of Indians lived in urban areas. In Italy this value was 54%. Different was the situation in Brazil, Russia and South Africa, where the percentage of urban population varied from 36% to 44%. From 1950 to 2010, the situation changed profoundly: Brazil displays a higher rate of urbanisation, with 8.4 out of 10 people living in cities, followed by Russia with 7.4 people out of 10. The urban development of South Africa underwent rapid acceleration from the Nineties onwards, whereas in China it occurred during the Eighties. To date, 6.2 out of 10 South Africans live in urban areas, while in China the proportion is 5 out of 10 inhabitants. India has also felt this push towards the cities, but at a lower intensity: though in constant growth, the urban population only just exceeds 30%, well below the average level of the other BRICS.
Not by chance, many cities in the BRICS at present compete in the classification of the most global cities, according to the AtKearnet ranking (Note 1), in terms of economic, political, socio-cultural development. If the first positions are solidly occupied by metropolises such as New York, London, Paris and Tokyo, the cities of emerging Countries are constantly gaining ground: Beijing is in 14th place, not far from Sydney (12th) and Vienna (13th). Moscow is in 19th place and Shanghai in 21st, just below Berlin. To find the first Italian cities in the list of the most global cities, the list has to be scrolled down to the 28th position (Rome) and the 41st position (Milan). When considering only the vitality of economic activity, Beijing and Shanghai are very high on the list, placed in sixth and seventh position respectively, whereas the Indian city of Mumbai is characterised by powerful growth registered over just a few years. On the other hand, these cities are still lacking when it comes to non-economic factors (cultural, human capital, political) and are penalised compared to more globalised Western cities.
The phenomenon of urbanisation has also brought benefits for the populations' quality of life. Life expectancy at birth, which in 1950 did not exceed 38 years in India, 45 years in China and South Africa and 51 years in Brazil, by 2010 had risen to over 72 years in Brazil and China, and around 64-68 years in India and Russia. South Africa seems to be moving at a slower pace; in 2010 life expectancy was 51 years old. (Figure 14.1.3)

The labour market

BRICS participation in the labour market has remained at a level which is higher than that which was registered for Italy, with the exception of South Africa. According to estimates by the International Labour Organisation (ILO), in 2010 the employment rate of people over 15 years old varied from 54% in India to 71% in China, compared to 44% in Italy. Unemployment rate has registered less significant differences: Russia and Brazil are moving away from the Italian figures a little (equal to 8.4%), while China remains around 4%.
Over the past two decades, the labour market has followed different paths within the BRICS. In China and India, the employment rate has progressively fallen, dropping by 4-5 percentage points over the years. Contrastingly, after a market contraction during the Nineties, Brazil and Russia witnessed accelerated growth after the beginning of the new millennium.
From within this context, South Africa presents wholly different characteristics: the employment rate has in fact remained at a very low level and despite several years of relative growth, in 2010 it just exceeded 39%. At the same time, the unemployment rate has registered alarmingly high values, with one worker out of four in search of a job.
The BRICS economic and labour structure is also very different from the Italian model. Taking Italy as a point of reference, with 68% of workers employed in the service sector, 29% in industry and 4% in agriculture, India represents the total opposite: it is characterised by a predominantly agricultural production system, with over 50% of workers falling within this sector and 22% within industry. China follows with a very high number of workers in agriculture (40%), but a significant number employed in industry (27%). Brazil, on the other hand, is characterised by a high number of workers in the tertiary sector (61%), to the detriment of the industrial sector (22%). Russia and South Africa are moving more decidedly towards the structure of Western markets, with agricultural employment percentages lower than 10% and tertiary sector workers exceeding 60%.
The BRICS are also characterised by differing levels of participation in the labour market for young people and women. In 2010 in China, Russia and Brazil, the rate of female employment exceeded 50% (34% in Italy), while in India and South Africa the level remained modest (28% and 32% respectively). It is however worth underlining the relationship between the genders. If in Italy the gap between men and women has reached 21%, in China and Russia it has remained around 11-13%. South Africa and Brazil are at Italian levels, whereas in India inequality has reached alarmingly high levels: in 2010 the gap exceeded 50%.
The rate of activity among the youth, which measures the level of participation in the labour market and includes both the employed and unemployed, is particularly high in China and Brazil where it exceeds 60%. In India and Russia the figure is more contained (38-44%), while in South Africa it has fallen to Italian levels (27%). Over recent years, rates have fallen across all the Countries, except for Brazil where a drop of only 3% was registered compared to the 17-18% drop in Italy and China. It is worth underlining that the rate of activity among young people is inversely proportional to the level of their participation in the education system: the higher the rate of activity, the lower the number of young people involved in educational courses.
It should nevertheless be emphasised that in several Countries informal employment represents an important factor: many workers work without legal and social protection, and in Italy they could fall within the cash-in-hand or undeclared work. According to the definitions given by the International Labour Organisation, this phenomenon includes both workers in businesses belonging to the informal sector (unregistered businesses), and workers in businesses belonging to the formal sector but without regular contracts. Informal employment has reached particularly alarming levels in Brazil and India where it represents 42% and 84% of workers respectively. (Figure 14.1.4)

Socio-cultural changes

The BRICS have taken some great steps forward with regard to socio-cultural conditions, although some significant criticalities still persist.
The cultural level of the population has improved across the Countries, even if marked differences still remain between them. Presently the literacy rate, calculated according to the UNESCO definition (Note 2), exceeds 99% in Russia, 94% in China and 90% in Brazil. Among these, China has succeeded in achieving the most significant progress: from 1980 to 2010 the proportion of literate individuals grew by around 30%. India has also improved its education levels over the years, although the results achieved remain well below those of other emerging Countries: literacy is stationary at 63%, even if it has increased by 22% since 1980.
With regard to tertiary education (ISCED 5-6, i.e. university degrees and higher qualifications), Russia stands out from among the BRICS with over 6,500 students per 100,000 inhabitants: this figure is greater than in many European Countries, including Italy which has around 3,400 students per 100,000 inhabitants. Brazil has a proportion of students registered in tertiary education similar to that of Italy (around 3,150 students), whereas China and India seem slightly behind with rates stationary at 2,340 and 1,580 students per 100,000 inhabitants respectively. Beyond the results achieved, it is interesting to observe the changes that have occurred over recent years. In Italy, the proportion of students registered in tertiary education compared to the population has remained just about constant, varying from 3,134 students in 2000 to 3,396 in 2008. The BRICS, on the other hand, have developed in a more marked fashion, leaving us to assume that further progress will occur in years to come: from 2000 to 2009, the number of students increased by 51% in Russia, 73% in India, almost doubled in Brazil and quadrupled in China. We are thus talking about increasingly educated populations which may become important partners for the development of Western Countries, first and foremost for Italy and Veneto.
Notwithstanding the improvement in education levels, several critical situations still persist within the BRICS concerning poverty and the redistribution of wealth. In particular, Brazil and South Africa are characterised by great income disparities: the Gini index, which extends from 0 to 100, where 0 represents completely equal distribution and 100 represents the maximum level of disparity, is very high at 53.9 and 67.4 respectively. Nevertheless, while in Brazil disparities are slowly diminishing, in South Africa they are still growing. Inequality is also increasing in India and China, although the Gini index maintains more contained figures (32-35), not dissimilar to those registered in Italy. Instead the feature that characterises these Countries is the percentage of the poor: in India 42% of the population lives on less than $1.25 per day, the threshold commonly identified as that which defines extreme poverty, while 76% live on less than $2. Up until the second half of the Nineties, China was characterised by a very high number of poor people (in 1995 74% were living on less than $2 per day). However, unlike in India, the situation has improved decidedly: in 2005 only 16 people out of 100 found themselves under the extreme poverty line of $1.25 per day, while 36% live on less than $2 (Figure 14.1.5)

North African Countries

Due to their geographical proximity, North African Countries (Algeria, Egypt, Libya, Morocco, and Tunisia) represent an excellent opportunity for trade and business transactions with Italy. Before the social and political uprisings which took place in 2011, North African Countries were experiencing a favourable period of economic development, with Gross Domestic Product growing on average by 4%. To provide just a few examples, between 2003 and 2005 Algeria grew at a rate of between 5 and 7%. At the same time, Libya exceeded 10%, in 2008 Egypt reached 7%, similar to Morocco which reached 8% by 2006. The Arab Spring partially halted this period of growth; however the estimates for the coming years speak of rapid economic recovery.
Nevertheless, despite this period of strong economic development, the GDP per capita is well below that of advanced economies: if in Italy each inhabitant corresponds to a little less than 30,000 dollars (Note 3), in a condition of equal purchasing power in the Countries of North Africa, with the exception of Libya, this figure does not exceed 10,000.
Moving now to factors that are more strictly social, the situation is very varied among the Countries of North Africa. First and foremost, they are very varied demographically: Egypt is the most populated Country with around 81 million inhabitants, and at the other end of the spectrum is Libya with a population of 6 million. These are, however, mainly young populations with a proportion of 0-14 year olds which varies from 23% in Tunisia to 32% in Egypt (in Italy it is equal to 14%).
Another aspect which distinguishes North African Countries is the distribution of the population across rural and urban areas. This indicator is useful for describing the transition of a Country from a predominantly agricultural economy to a more industrialised one. Of all the Countries, Libya is definitely the most urbanised: the percentage of inhabitants living in cities exceeded 77% in 2010, although it had already reached 75% during the second half of the 1980s. Algeria and Tunisia also display high levels of urbanisation, whereas Morocco and above all Egypt remain predominantly rural Countries.
Although on different levels, these North African Countries display reasonably low literacy levels: in 2010 the literacy rate only reached 90% in Libya whereas, for example, it stopped at 56% in Morocco. Here, the number of students registered in tertiary education is also limited, while it is higher in the other Countries, where it approaches the levels of the advanced Countries.
Finally, rates of employment among the over-15 age band have stayed between 39% (in Algeria) and 49% (in Libya). Unemployment rates among young people are more alarming, with values exceeding 22% and up to 31% in Tunisia. (Table 14.1.1)

The Arab Countries of the Gulf

The Countries belonging to the Gulf Cooperation Council (Saudi Arabia, Kuwait, Qatar, Arab Emirates, Oman and Bahrain) are rich in energy resources and have followed a positive growth trend over the past decades. Nevertheless, the high degree to which their economies rely on the extraction of non-renewable energy has led to many governments looking towards important diversification policies for the production of wealth, above all focusing on infrastructure, tourism and the service sector in general.
The economic dynamics of the first decade of the 21st century have been very lively. The Gross Domestic Product of Qatar has grown on average by 13%, peaking at 26% in 2006. In 2008 Oman experienced growth of 13% whereas from 2003 to 2005, Kuwait maintained a constant two-figure rate of growth, similar to the Arab Emirates. The wealth of these Countries also becomes clear through an analysis of per capita GDP under conditions of equal purchasing power: in Qatar it exceeds 88,000 dollars per inhabitant, in the Arab Emirates, 46,000 dollars and in Kuwait it has reached 39,000.
These are not however particularly populated Countries: Saudi Arabia is the only one to have reached 27.4 million inhabitants, whereas the other Countries in the area only just exceed 16 million. Besides being the most populated state, Saudi Arabia is also the youngest: almost a third of its population is under 15 years old. Following Saudi Arabia are Oman and Kuwait, while Qatar and the Arab Emirates present a more balanced demographic structure leaning towards the central age bands: over 70% of the population is between 15 and 44 years old.
The Countries overlooking the Gulf have followed very different paths of urban development, though they have reached similar levels: the degree of urbanisation is in fact quite high, even as high as 98% (Kuwait and Qatar). Development periods do however differ: some Countries concluded the transition from rural to urban society several decades ago (for example, Bahrain did so during the Sixties and Kuwait during the Eighties), whereas others still appear to be in the development phase (Saudi Arabia and Arab Emirates).
The high degree of urbanisation has most definitely influence socio-cultural development. Basic education is more or less widespread, with literacy rates reaching over 90% in many cases. In the tertiary education sector however, only Saudi Arabia has reached levels equivalent to advanced Countries. With regard to the labour market, the Countries of the Gulf share high employment rates and contained levels of unemployment. (Table 14.1.2)

Latin American Countries

Aside from Brazil, many other Countries in Latin America (Chile, Columbia, Mexico, and Peru) have experienced particularly high levels of growth. In particular, Mexico represents the second largest economy in Latin America and is considered an emerging partner for international exchange. Gross Domestic Product has grown rapidly over the first few years of the 21st century, although in 2009 it suffered from the global financial crisis. Chile and Columbia are also very dynamic economies, witnessing growth rates of up to 7% from 2004 to 2007. The performance of Peru has been even more stellar: in 2008 its Gross Domestic Product grew by almost 10%. Nevertheless, the common characteristic of these Countries is their ability to recover, which was demonstrated in the wake of the financial crisis: in 2010 they had already ensured the recovery of significant losses registered during the previous year.
From a demographic point of view, Mexico has over 113 million inhabitants, whereas the other Countries are smaller in size, varying from 17 million in Chile to 46 million in Columbia. As in the case of other emerging Countries, the population is very young: the proportion of young people in the 0-14 age group oscillates between 22% in Chile to 30% in Peru, whereas the proportion of people between 15 and 44 years old remains around 46-48%. The population lives mainly in cities, with high rates of urbanisation, particularly in Chile (89%). Predictions for the coming years show even further growth.
Employment rates are generally good: the labour market is particularly bright in Peru, with an employment rate which exceeded 71% in 2010 and a rate of unemployment equal to 6.3%. Mexico has lower levels of employment, although unemployment is just over 5%. In Chile and Columbia, the proportion of unemployed people is slightly higher (8-12%) although the trend is improving.
Basic education is very satisfactory: the literacy rate varies from 90% in Peru to 99% in Chile, where there is also a high number of students registered on courses in superior education: around 5,200 every 100,000 inhabitants.

The Countries of South East Asia

Finally, we can take a look at the Countries of South East Asia (Indonesia, Malaysia, the Philippines, Thailand, and Vietnam). The 1997-1998 crisis of the Asian markets profoundly hit the region, causing a serious period of recession: the Gross Domestic Product fell by 13% in 1998 in Indonesia and by 11% in Thailand. From within this context, the Countries of South East Asia engaged in profound efforts to return to excel on the international stage, reaching excellent development levels.
From 2000 onwards, Indonesia and Vietnam recorded growth levels of between 5 and 7%, without being affected by the 2009 economic crisis. The Philippines have also been moving into positive territory despite the fact that in 2009 their GDP had only increased by a single percentage point. Malaysia and Thailand on the other hand, felt the effects of the crisis more heavily and, after years of economic growth, they came to a standstill in 2009; in 2010 they did however begin their recovery with development rates equalling those of other Asian Countries.
Economic development has not however resolved the problems of social inequality. First and foremost, the Gross Domestic Product per capita remains relatively low: it exceeds 20,000 dollars per inhabitant in Malaysia alone. In Indonesia, the Philippines and Vietnam it is no greater than 7,000 dollars. Another very important indicator is the Gini coefficient that, as described previously, measures the unequal distribution of income: in Malaysia it has reached 46.2 and also exceeds 40 in Thailand and the Philippines. The wealth produced is not therefore accessible to all, instead it creates large inequalities within the population.
As far as the demographics of the area is concerned, Indonesia is the fourth most populated Country in the world after China, India and the United States with 240 million inhabitants. The Philippines and Vietnam remain on 90 million inhabitants, whereas Malaysia is the least populated of the five nations with 28.4 million people. The percentage of the population living in urban areas suggests very different growth paths from those found in the emerging Countries previously described. In fact, only Malaysia has reached an urbanisation rate of 72%. Indonesia and the Philippines are stable on around 50%, whereas in Vietnam and Thailand only one in three people lives in a city.
Education levels have grown quite high with literacy rates everywhere exceeding 90%, and with the number of students registered in tertiary education reaching 3,000 students per every 100,000 inhabitants in the Philippines and Thailand.

The increase in business exchanges abroad on the part of the businesses of Veneto has certainly been pushed by the vitality of the BRICS and other emerging Countries. As already analysed in the previous paragraph, the BRICS actually initiate 16% of world exports and 15% of imports; such figures are growing rapidly compared to the first few years of the new millennium.
In 2011, the value of Veneto business' exports to the BRICS exceeded 4.4 billion euros, an increase of around 25% on the previous year. The growth rate is well above the regional average which, between 2010 and 2011, remained at 10%. Overall, exports to the BRICS represent 9% of Veneto exports, a value which was just over 3% in 2000. In this context, China and Russia are confirmed as the most important markets in the area, overall recipients of 6.7% of exported wealth. Brazil and India, on the other hand, still play a marginal role with around an 8% share of the Veneto market. Nevertheless, the economic value of exports to these two Countries is continually growing, suggesting that large development margins will emerge in the future.
With regard to the other emerging Countries, the slice of the export market varies from 1% in South East Asia (Indonesia, Malaysia, the Philippines, Thailand and Vietnam) to 2.1% in the Arab states (Saudi Arabia, Bahrain, United Arab Emirates, Kuwait, Oman, and Qatar). The impact of this latter area has grown particularly well over time: the value of exports more than doubled from 2000 to 2011 and the share of the total increased by 0.7%.
Regarding imports, the BRICS are still very influential; equal to 15% of Veneto imports, with China alone accounting for 10%. The business exchange trend has been profoundly marked over time by the market contraction which occurred as a result of the economic crisis: in 2009, Veneto reduced the overall value of merchandise and products imported from abroad by about 22%. As a consequence, imports from the BRICS also fell by 23% from 2009 to 2008, with a significant recovery being registered from 2010 onwards. In particular, from 2009 to 2010 Chinese imports grew by 35%, Russian imports by 57% and Indian imports by 72%. From 2010 to 2011, particularly shining import figures were registered from Russia, which had grown by 85%.
Regarding the other emerging Countries, the market share of North Africa remains important, with a weight of 2.4% on Veneto imports. This is despite the fact that during the course of 2011, this value fell by over 2%. The popular revolts which exploded in this area have certainly had repercussions on the overall structure and economies of these States. (Table 14.2.1)
Of the product sectors most relevant to exports to the BRICS, the mechanic sector represents 41% of exchanges made. The mechanic sector represents an excellent opportunity for exchanges with emerging Countries: it is one of the most highly competitive and specialist fields within the economy of the region of Veneto but above all, it represents important investment opportunities for the emerging Countries seeking to structure their own businesses and modernise their machinery.
Following the BRICS but at a much lower level is the fashion industry (13%) and the jewellery, sporting goods and medicinal sectors (9%). The structure of the exports has however changed a great deal over the years: the mechanical sector is in fact increasingly monopolising the value of exported wealth, to the detriment of other sectors such as fashion, jewellery, chemical and wood. It should however be underlined that from 2000 to 2011 all sectors recorded a good increase, and mainly the agri-food industry and that of metals: the agri-food turnover has grown from 25 to 134 million euros, that of the metal sector has grown from 64 to 320 million.
Mechanic products are the most exported for the other emerging Countries too, although there are differences. The mechanic sector in fact represents 47% of all exports to Latin American Countries (Chile, Columbia, Mexico and Peru), but only 28-29% of exports to Arab Countries and North Africa (Morocco, Tunisia, Algeria, Egypt and Libya). In these two areas the fashion industry (26% of exports to North African Countries) and the jewellery sector (25% to Arab Countries) are of more importance. Growth dynamics also vary: from 2000 to 2011 the agri-food sector has grown the most in Arab Countries (+362%), whereas in North Africa and in the South East Asia the sector that has grown the most is transport.
Among the most important products, fashion plays a hugely influential role: in this case, the BRICS represent our main suppliers. Within the BRICS, this sector represents a third of imports, with values reaching 62% in Brazil, 47% in India and 34% in China. From Russia and South Africa, on the other hand, it is metals and minerals that arrive most frequently. Aside from the importance of the fashion industry over the years, the electronic and electrical equipment sectors have also gained ground to the detriment of the metal industry.
Fashion is also the sector most imported from North African Countries and South East Asian nations whereas Arab Countries mostly export oil-based products. Latin American Countries present a more varied picture, with a significant weight in the agri-food sector, fashion, chemicals and metals. (Figure 14.2.1)
The opportunities provided by the development of new markets cannot abstract from the economic fabric of Veneto and the whole of Italy. In fact, growth must begin from that which Italy and Veneto know best: high quality products based on the made in Italy tradition. Emerging markets are heading in precisely this direction: new young consumers with a high level of cultural knowledge and growing per capita income who are open to technological innovation and are increasingly attracted by so-called 'affordable luxury'. For further information on this, refer to chapter 12 'Beautiful and well made', in which the potential of made in Italy products in new markets is analysed.
Emerging Countries do not only represent imported and exported wealth, but also local-level entrepreneurial wealth, whether represented by foreigners residing in Veneto or Veneto natives living abroad. These features are developing within an economy that is becoming increasingly attentive to exploiting the opportunities offered by new markets.
In 2011 in Veneto there were over 15,000 entrepreneurs originating from the BRICS and other emerging Countries. In particular, over 8,500 entrepreneurs come from the BRICS Countries, of which 6,280 from China and 1,191 from Brazil. Their specialist areas do however differ greatly: in 93% of cases, Chinese entrepreneurs work in the manufacturing, business and catering industries, whereas the Brazilians most often work in the construction industry. Indian entrepreneurs, on the other hand, have a higher proportion of workers in the business support services.
Nevertheless, it is the rapidity of the development which has occurred over only a few years which remains surprising: if in 2000 there were 930 Chinese entrepreneurs, in 2011 a total of 6,280 had been reached. The same trend was registered for other Countries, with Brazilian entrepreneurs having more than tripled and Indian entrepreneurs growing from 46 to 700.
Among the other emerging Countries, it should be first underlined the role of the North African Countries and in particular, that of Morocco. There were around 4,500 entrepreneurs originating from this Country in 2011, despite the fact that at the beginning of the new millennium there were just over 1,000. Business and construction are the main sectors in which Moroccan entrepreneurs decide to open their businesses.
With regard to the businesses of Veneto that have succeeded in finding new openings in international markets, in 2009 there were more than 560 businesses operating in emerging Countries and controlled by multinationals from Veneto. The BRICS area play host to the majority of these businesses (380) and among them is China, undoubtedly the most explored terrain, with 168 businesses of which Veneto companies hold stakes. Very significant is the increase recorded in only three years is: the number of Chinese businesses in which Veneto businesses hold stakes has grown by 71 since 2006. In Brazil this number is 95, thus representing a solid investment opportunity for our entrepreneurs (Table 14.2.2)
Of the growth opportunities offered by emerging Countries, tourism should be considered as the apple of Veneto eye.
Of the 10 million foreign tourists who arrived in Veneto in 2011, over 9% were from the BRICS: 387,000 tourists from China, almost 242,000 from Russia and 187,000 from Brazil, and these are only the largest figures which might be used to describe the potential and induction of a sector upon which Veneto should focus in order to tackle economic recovery. Furthermore, over a decade the size of the phenomenon has grown enormously: since 2000, Chinese and Brazilian tourists have more than tripled, Russian tourists have grown almost five times, and Indian tourists have growth by 136% since 2005. In the group of other emerging Countries, in eleven years Arab tourists have grown from around 17,000 to more than 40,000.
Overall, 924,000 tourists from BRICS correspond to around 1.8 million visits, allowing to estimate that on average, every tourist spent 1.9 nights in various accommodation facilities in the region of Veneto, compared to the 3.9 nights recorded for foreigners of all of nationalities. Short stays prevail, in part determined by the type of holiday and accommodation.
BRICS tourists are in fact attracted to Veneto almost exclusively for its artistic beauty and cities of art; very often, Venice, Verona and Padua are included within wider packages which allow tourists to visit more than one city in a few days, for example Rome and Florence. It therefore results that 9 out of 10 arrivals to Veneto are concentrated in the cities of art, whereas the remaining slice is divided into more or less equal parts between visits to seaside resorts, lakes, mountains and spa resorts. In order to understand the peculiarities of this group of tourists, it is enough to underline that among the arrivals from non-BRIC Countries, the number directed to cities of art descends to 52%. In 2011, tourists from the BRICS represented 15% of those packing out our cities of art, a value which was no greater than 9% in 2005.
With regard the type of stay, tourists from the BRICS opt almost exclusively for a hotel structure: 96% of Chinese and 94% of Indian tourists choose this type of accommodation as well as 91% of Brazilian and 89% of Russian tourists. South African tourists vary somewhat: they only choose hotels 82% of the time, whereas they seem to prefer private accommodation most of the time (11%). Although hotels remain the main choice among foreigners originating from non-BRIC Countries, this is by no means exclusive. In fact, 67% of tourists stay in hotels, whereas campsites and holiday resorts also feature heavily (18% compared to 1% for the BRICS) as well as other forms of private accommodation (11% vs. 2%).
Visits by BRICS tourists, similar to those originating from other emerging Countries, are also characterised by higher quality accommodation. Compared to other foreigners, tourists from the BRICS tend to prefer higher rated hotel structures: of those who stay in hotels, 68% of BRICS tourists and 70% of Arab tourists choose a 4 or 5 star facility, compared to 51% of other foreigners. The Chinese seem to have a higher spending capacity, with a number of arrivals to the most expensive hotels approaching close to 80%. Although Russian tourists tend to opt for lower quality hotels and take longer holidays: on average, they stay for around 2.5 nights in hotels of up to 3 stars and 3 nights in hotels of 4-5 stars, compared to the Chinese who stay only 1.2 nights on average. (Figure 14.2.2)