Revista de Economie Mondiala/ Journal of Global Economics

1-18

Authors: Iulia Monica Oehler-Șincai

In the present paper, our main objective is to bring to the forefront two notable processes, as a result of the world financial and economic crisis. On the one side, we underline the increasing role of the emerging countries (especially that of China, Brazil, Russia and India) in the world economy and, on the other side, we underscore the remodelling of the patterns of economic growth and development in the case of the BRICS countries. The Russian Federation, Brazil and South Africa rapidly eased out of the recession in 2009, while China and India continued to record robust growth rates. Nevertheless, in 2012, one can remark the precipitate slowdown of the GDP growth in all the five analysed economies. This demonstrates that the emerging economies were not able to “decouple” from the world economy and, on the contrary, they were deeply affected by the adverse economic situation in the USA and the EU (especially the Euro Zone). At the same time, China’s economic slowdown negatively influences Brazil, Russia, India and South Africa, as China represents the largest trading partner for them, after the EU. At the same time, one should not ignore the actual weaknesses of these economies. For instance, inflation represents a “common vulnerability” of the BRICS. In this situation, the selection of the most viable instrument of monetary policy represents a veritable challenge for the authorities in these countries, as the economic growth should be stimulated but, at the same time, inflation has to be tempered. Besides, unemployment rate in South Africa is already at high levels. The fiscal deficit, as a percentage of GDP is excessive in India and South Africa and the public debt to GDP ratio is extremely high in India and Brazil. During the world financial and economic crisis, the authorities and companies, both public and private, concentrated their attention more and more on the internal markets, with a high absorption capacity. Without giving up exports and FDI as engines of economic growth, the administrative bodies at macro and microeconomic levels understood that the internal demand represents a complementary source of growth. In contrast with the most developed countries, which intensely resorted to austerity measures, the BRICS were able to adopt stimulus measures. Such Keynesian moves were possible, as the emerging countries entered the global crisis with strong macroeconomic and financial positions. As a matter of fact, the world financial and economic crisis erupted in a moment considered by the international experts as the “most prosperous” for these countries. The general measures adopted in order to stimulate the economy in the field of fiscal policy and monetary policy were combined with specific, sectoral ones. Such measures managed even to attenuate the negative effects of the global crisis at social level. Infrastructure development though public investment projects is used by the BRICS governments as one of the principal means to stimulate economic growth and jobs creation. Our paper concludes that, for the BRICS countries, the classical engines for economic growth like exports and inward FDI are complemented by additional growth engines: internal demand (spurred by the high level of remittances from abroad), the outward FDI, innovation and infrastructure development.

1-33

Authors: Cristina Bumbac

Rare Earth Elements or Rare Earth Metals (REM) are a collection of seventeen chemical elements in the periodic table, namely scandium, yttrium and fifteen lanthanides. The term "rare earth" arises from the rare earth minerals from which they were first isolated. They are uncommon oxide-type minerals (earths) found in Gandolinite extracted from one mine in Sweden. The first discovery was made in 1794, but it was only in 1940 that the scientist Frank Spedding developed an ion exchange procedure for separating and purifying the REM. For the next decades, they were hardly used in some "minor" industrial fields. Only after 2000 their importance grew, once the multitude of possibilities to use them was discovered due to technological progress. Now REM are incorporated into almost all modern technological devices: superconductors, magnets, electronic polishers, refining catalysts hybrid car components and military techniques. They are used in small quantities, but due to their extraordinary properties the prices are very high. The main problem is that China dominates this market, with 97% of total global supply. The highest concentration of rare earth metals are in Inner Mongolia in China, Mountain Pass in California U.S.A. and in Mount Weld in Australia. The developed countries are far behind China regarding production and are indeed depending on Chinese exports. Hence, there is a difficult situation on this particular market, with an uncertain future.