Sunday, January 1, 2017

Breakout Nations- Ruchir Sharma

Rating- 3.5/5
Copy- Hardbound
Genre- Economics

Many marketing pundits say that the tagline captures imagination more than the title. Ruchir Sharma’s book – Breakout Nations “In Search of the Next Economic Miracle” does justice to the title. Sharma, a leading economist at Morgan Stanly, brings his wealth of experience in economics in a lucid prose which is extremely engaging for someone who is doing a cursory reading. The unfortunate part that comes across is the lack of depth in the book. Here and there, one gets the feel that the book is made from the footnotes of research papers or made from a string of interviews to a television channel.  By mid-way, you have kind of figured out what a nation must have to be an economic juggernaut

low inflation
diversified economy
export oriented or a big domestic market
not highly corrupted
low %share of debt (public+private) to GDP

Added Bonus factors are
less share of GSE (govt sponsored enterprises) in key market areas
reform-oriented government
tier-II level for per capita income (sub-$10,000)
younger demography



Taking a cue from the above indices, the author paints the economic picture of a county. The author lists few countries to watch out for – South Korea, Poland, Czech Republic & Turkey which he considers to be breakout nations that can be subsets of engine growth to the world economy. He makes passionate cases on why he considers these economies to fare well. The book was written in 2012 when China was leading the economic growth of the world. Sharma questions the high debt the country was incurring & predicted correctly that a bubble will burst soon. His notes on the Russian economy makes a decent read, his warnings to the commodity-oriented economy are well-founded. Russia & Brazil are currently bearing the brunt of falling commodity prices.
Sharma does bring a personal touch to each of the cases he deciphers. The book manages to package an economy but does fall short of expectations to someone who is looking for more than just a cursory read.

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