Davindranauth Shiwratan

July 12, 2014

BRICS launching Development Bank

The 5 major emerging world economies, BRICS, are expected to launch their development bank at a summit on July 15 in the northeastern Brazilian city of Fortaleza. BRICS stands for Brazil, Russia, India, China, and South Africa.

The BRICS bank will present an alternative solution to the Western global banking system comprised of the Bretton Woods institutions – the World Bank and the International Monetary Fund (IMF). The new bank will provide a collective foreign exchange reserve and a fund for financing development projects in order to address the needs of emerging and poor economies.

Under the deal, the two largest emerging world economies, China and Brazil, agreed to remove nearly half of their trade exchanges out of the US dollar zone. The BRICS countries will contribute up to $10 billion each in starting the development bank. It could take several years to be operating. The bank will function on national currencies rather than using a single currency; it will be adopted in bilateral and multilateral trade deals.

BRICS countries make up over 40% of the world’s population and account for more than 25% of the global GDP. The leaders of BRICS will decide over the location for the bank’s headquarters between Shanghai, China and New Delhi, India.

BRICS members say the current global balance of power is unworkable, with institutions such as the World Bank, the International Monetary Fund (IMF) and the United Nations Security Council (UNSC) irrelevant in addressing matters concerning global economics. (PressTV)

 Source:

“BRICS to launch development​ bank.” Press TV 12 July 2014.

http://edition.presstv.ir/iphone/detail.aspx?id=370950