China’s economic crisis is still in the early stages. Eventually, China will have to buy up the bad loans and recapitalize her lenders, but doing so will be tricky and time-consuming. In addition, the effort will eat up much of China’s accumulated foreign currency holdings and other state assets. That in turn will require an unacknowledged abandonment of attempts to take Taiwan by force and will diminish the credibility of the BRICs scheme.
I couldn’t agree more. The BRICs myth is the product of bluffing and wishful thinking. Without an ascendant China, BRICs is nothing.