IS IT POSSIBLE FOR EUROPE TO GET HELP FROM BRICS COUNTRIES?

Mihai Dragu
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Mihai Dragu: University of Craiova Faculty of Economics and Business Administration

Annals of University of Craiova - Economic Sciences Series, 2011, vol. 1, issue 39, 206-210

Abstract: Within the second decade of the month of September 2011, the Brazilian finance minister Guido Mantega advanced the idea that BRICS countries could offer help to Europe either through the International Monetary Fund or by buying up European bonds. Is this help hiding an interest from the BRICS countries side? I believe it is, because the European authorities have created a financial crisis that is already slowing the world economy and could potentially have even worse effects. In my opinion, this could hurt BRICS countries, including Brazil. I do believe that if the BRICS countries really want to give a hand to Europe, they can, eventually, offer zero or low interest loans in hard currency to the troubled countries. If this move is done correctly, it would allow to those damaged countries to escape the harmful conditions that the European authorities are imposing on them. Of course, Greece would have to default on a lot of its debt to take advantage of this alternative, but the other countries would not. In this way, the BRICS countries could help save Europe from this incompetence of their policymakers!

Keywords: BRICS; global crisis; emerging economies (search for similar items in EconPapers)
JEL-codes: F02 F15 (search for similar items in EconPapers)
Date: 2011
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