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CIVETS

CIVETS countries: Colombia, Indonesia, Vietnam, Egypt, Turkey, and South Africa

The CIVETS are six favored emerging market countries – Colombia, Indonesia, Vietnam, Egypt, Turkey, and South Africa.[1] These countries are favored for several reasons, such as "a diverse and dynamic economy" and "a young, growing population".[2] This list is comparable to the Next Eleven, devised by Jim O'Neill of Goldman Sachs.

Etymology

The acronym CIVETS was coined by Robert Ward, Global Director of the Global Forecasting Team of the Economist Intelligence Unit (EIU) in late 2009,[3][failed verification] and was further disseminated by Michael Geoghegan, President of the Anglo-Chinese HSBC, in a speech to the Hong Kong Chamber of Commerce in April 2010. Geoghegan compared these countries to the civet, a carnivorous mammal that eats and partially digests coffee cherries, passing a transformed coffee bean that fetches high prices.

Implications

The economies that are part of this group are considered to be very promising because they have reasonably sophisticated financial systems, controlled inflation, and soaring young populations.[4]

Michael Geoghegan has called these countries "the new BRICS" because of their potential as second-generation emerging economies. In 2010, he said, "emerging markets will grow three times as fast as developed countries this year", adding that the center of gravity of the world was moving towards the East and the South (Asia and Latin America).[5]

As well as being seen as attractive markets, the role of CIVETS countries in global governance is also discussed, especially at the G20, of which Indonesia, South Africa, and Turkey are members. They are already perceived as "development providers investing in peer-to-peer learning and horizontal partnerships and (...) are bound to become strategic players at the G20, UN and IFI levels".[6] In view of this, during the 2011 annual meetings of the International Monetary Fund and the World Bank, the economy and finance ministers of the CIVETS countries established a formal mechanism for communication and coordination.[7]

All the CIVETS countries except Colombia and South Africa are also 'Next Eleven' countries.

Challenges

All of these states also share similar challenges: unemployment, corruption, and inequality are persistent problems in most of the countries of the group.

Members

Colombia

Colombia is a member of the Pacific Alliance, the Andean Community, and the Association of Caribbean States. Colombia historically was a country that was immersed in political violence and repression since La Violencia; however, with the Constitution of 1991, Colombia finally remerged democratically, though with severe obstacles from the Colombian conflict as well as political crises such as the Parapolitica scandal. In recent years, great strides have been made, with several institutional changes taking place. There are policies that favor the creation of new businesses, and foreigners can integrate into the market without major hurdles.[8] Foreign investment increased five-fold between 2002 and 2010,[9] and there has also been a petroleum and gas boom.[10] The government is devising strategies to avoid the Dutch disease as billions of dollars enter the country.

As of August 2010, Colombia has a budget deficit of 3.6%. The inflation rate is 2.6% and external debt a modest 47% of gross domestic product.[11] Foreign investment is leading to noticeable improvements in infrastructure.

Today, Colombia's diversified economy is the third largest in Latin America, with macroeconomic stability and favorable long-term growth prospects.[12][13]

Indonesia

Indonesia is a member of ASEAN.

After emerging as the third-fastest-growing member of the G20 in 2009, Indonesia has been a strong performer. Like China and India, it is expanding rapidly. Investment growth in 2009 was boosted by infrastructure spending and high commodity prices.

The population of Indonesia is 243 million and it has a GDP of $834 billion in 2011. The budget deficit is 2.1% of GDP, and the current account is in surplus.[14][when?]

Vietnam

Vietnam is a member of ASEAN.

After the death of its leader Lê Duẩn in 1986, Vietnam began making the transition from a planned economy to a socialist-oriented market economy after suffering an inflation rate of 700% and a stagnant economy.[15] The Communist Party launched a broad economic reform package called Doi Moi ("Renewal"), with similarities to the Chinese model (economic openness mixed with communist politics), and achieving similar results. Between 1990 and 1997, Vietnam's economy grew at 8% per annum, with similar results in the following years.

Vietnam's rapid growth from the extreme poverty of 1986 has given rise to western consumerist habits, especially among the new rich of Vietnam, opening the gap of social inequality and bringing inflation up to 12%, after it had recovered to 4%. However, Communist Party leaders are optimistic about maintaining the growth rate so that in 2020 it will be considered a newly industrialized country.[16]

Egypt

In September 2011, the World Bank predicted growth of just 1% for that year, compared with 5.2% in the previous year, but analysts expected Egypt to regain its growth trajectory once political stability returned. Egypt has many assets, including fast-growing ports on the Mediterranean and Red Sea linked by the Suez Canal, a growing tourism network, and vast untapped natural gas reserves. Egypt's 82 million population has a median age of 25.[17]

Turkey

In 2011, Turkey had the world's 15th largest GDP-PPP[18] and 18th largest Nominal GDP.[19] The country is a founding member of the OECD (1961) and the G20 (1999). Since 31 December 1995, it has been part of the EU Customs Union. Mean wages were $8.71 per man-hour in 2009. Turkey grew at an average rate of 7.5 percent between 2002 and 2006, faster than any other OECD country. Over the past 20 years, Turkey has made significant improvements in economic freedoms. It has expanded monetary freedom, freedom from corruption, and fiscal freedom; these advancements have, nevertheless, been undermined by Turkey's deteriorating property rights and financial freedom.[20]

According to a survey by Forbes magazine, Istanbul, Turkey's financial capital, had a total of 28 billionaires as of March 2010 (down from 34 in 2008[21]), ranking 4th in the world behind New York City (60 billionaires), Moscow (50 billionaires), and London (32 billionaires).[22] In 2012, Istanbul ranked 5th in the world with 30 billionaires, behind Moscow (78 billionaires), New York City (57 billionaires), London (39 billionaires), and Hong Kong (38 billionaires).[23][24] Turkey's major cities and its Aegean coastline attract millions of visitors every year.

The CIA classifies Turkey as a developed country.[25] It is often classified as a newly industrialized country by economists and political scientists.[26][27][28]

Economic data

According to the 2012 CIA World Factbook:[when?]

Member 2011 GDP[29]
(nominal PPP)[30]
Millions $US
2011 GDP per capita
(nominal PPP)[31]
$USD
2011 Exports[32]
Millions $USD
Population
Jul. 2012 (est.) [33]
Colombia 397,500 533,700 6.953 10,100 55,030 45,239,079
Indonesia 834,300 1,121,000 3,498 4,700 208,900 248,216,193
Vietnam 121,600 299,200 1,341 3,300 96,810 91,519,289
Egypt 320,500 1,027,000 3,087 16,476 50,000 94,097,164
Turkey 763,100 1,053,000 10,579 14,600 133,000 79,749,461
South Africa 422,000 554,600 8,370 11,000 94,210 48,810,427

See also

References

  1. ^ City Diary (2010-07-12). "Geoghegan digests and delivers new acronym". London: Telegraph.co.uk. Retrieved 2012-06-28.
  2. ^ "From West to East" (PDF). HSBC. Retrieved 2012-07-02.
  3. ^ "BRICS and BICIS". The Economist. 2009-11-26.
  4. ^ "World investment: Beyond BRICs". Archived from the original on July 10, 2011. Retrieved September 16, 2010.
  5. ^ [1]
  6. ^ "CIVETS - The third wave of development players". Fride.org. Archived from the original on 2012-06-12. Retrieved 2012-06-28.
  7. ^ "Ministers of Economy and Finance of CIVETS countries define a common agenda for the coming years". Archived from the original on 2013-07-21. Retrieved 2012-06-28.
  8. ^ "Doing Business Measure of Colombia's business regulations". Doingbusiness.org. 2011-12-30. Retrieved 2012-06-28.
  9. ^ Markey, Patrick (2010-08-07). "Santos takes office with strong mandate". Reuters.com. Retrieved 2012-06-28.
  10. ^ "Colombia's oil boom". Theworld.org. 2010-07-19. Archived from the original on 2010-09-19. Retrieved 2012-06-28.
  11. ^ "CIVETS". Dailymarkets.com. Archived from the original on 2012-04-30. Retrieved 2012-06-28.
  12. ^ Cite error: The named reference GDP was invoked but never defined (see the help page).
  13. ^ "IMF Executive Board Concludes 2018 Article IV Consultation with Colombia". imf.org. Retrieved 2 May 2018.
  14. ^ "ΟΙ ΑΠΟΡΙΕΣ ΤΟΥ ΣΤΕΦΑΝΟΥ ΜΑΝΟΥ". European Business Review (in Greek). Retrieved October 29, 2010.
  15. ^ Bill Hayton (2006-09-02). "BBC Mundo - Vietnam: ¿comunista o consumista?". BBC News. Retrieved 2012-06-28.
  16. ^ [2][dead link]
  17. ^ Greenwood, John (2011-09-18). "After BRICs, CIVETS? September 19, 2011". Online.wsj.com. Retrieved 2012-06-28.
  18. ^ The World Bank: World Development Indicators Database. Gross Domestic Product 2011, PPP. Archived 2012-11-19 at the Wayback Machine Last revised on 18 September 2012.
  19. ^ The World Bank: World Development Indicators Database. Gross Domestic Product 2011. Archived 2012-10-27 at the Wayback Machine Last revised on 18 September 2012.
  20. ^ "Turkey Economy: Population, GDP, Inflation, Business, Trade, FDI, Corruption". www.heritage.org.
  21. ^ Vorasarun, Chaniga. "In Pictures: The Top 10 Cities For Billionaires".
  22. ^ Forbes Billionaires List, Cost Of Living in Forbes Magazine article "Billionaires List, Cost Of Living". March 29, 2010.
  23. ^ Melby, Caleb. "Moscow Beats New York, London In List Of Billionaire Cities".
  24. ^ Melby, Caleb. "Moscow - pg.1". Forbes.
  25. ^ Developed Countries, World Factbook, CIA.
  26. ^ Mauro F. Guillén (2003). "Multinationals, Ideology, and Organized Labor". The Limits of Convergence. Princeton University Press. pp. 126 (Table 5.1). ISBN 0-691-11633-4.
  27. ^ David Waugh (2000). "Manufacturing industries (chapter 19), World development (chapter 22)". Geography, An Integrated Approach (3rd ed.). Nelson Thornes Ltd. pp. 563, 576–579, 633, and 640. ISBN 0-17-444706-X.
  28. ^ N. Gregory Mankiw (2007). Principles of Economics (4th ed.). ISBN 978-0-324-22472-6.
  29. ^ "Central Intelligence Agency". Cia.gov. Retrieved 2012-06-28.
  30. ^ "Central Intelligence Agency". Cia.gov. Retrieved 2012-06-28.
  31. ^ "Central Intelligence Agency". Cia.gov. Retrieved 2012-06-28.
  32. ^ "Central Intelligence Agency". Cia.gov. Archived from the original on 2012-05-04. Retrieved 2012-07-02.
  33. ^ "Central Intelligence Agency". Cia.gov. Retrieved 2012-07-02.