Brics development bank to have headquarters in China

2014-07-16 08:35

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Fortaleza, Brazil – The leaders of five emerging market powers said they have agreed to create a development bank worth $100 billion (R1.07 trillion) that will have its headquarters in China.

The first president of the New Development Bank will be from India and the position will rotate every five years among Brazil, Russia, India, China and South Africa – the so-called Brics nations – a joint statement from the leaders said.

Brics leaders conferred in a closed session earlier yesterday at their conference in northeastern Brazil. Later they announced concrete plans for the bank at an afternoon session open to the press.

The new bank is seen as a strong push by the Brics against the World Bank and the International Monetary Fund, which the developing world has long complained is far too US- and European-centric.

“Based on sound banking principles, the NDB will strengthen the cooperation among our countries and will supplement the efforts of multilateral and regional financial institutions for global development,” the statement said.

Russian Foreign Minister Sergey Lavrov told the Russian news agency ITAR-Tass that the decision “confirmed that Brics members, while speaking against unilateral actions in the world economy and politics, are not seeking confrontation, but propose working out collective approaches toward the resolution of any problems”.

The New Development Bank will have an African regional branch in South Africa and eventually other nations will be able to participate.

The statement also alluded to Brazil’s and India’s long-standing quest to overhaul the United Nations Security Council, of which China and Russia are two of five permanent members with veto power. Those nations have in the past proved reluctant to endorse Brazil’s and India’s ambitions, but Tuesday’s statement said the Brics nations “support their aspiration to play a greater role in the U.N.”

Though exhaustive, the joint statement largely steered clear of potentially divisive issues, like the conflict in Ukraine between pro-government and pro-Russia factions.

It touched only briefly on the matter, saying the five countries expressed their “deep concern” with the situation in Ukraine and urged “comprehensive dialogue”.

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