Dream come true
BRICS BANK A BIG DREAM COMING TRUE?
Writes Mhleli Mkhize
BACKGROUND OF TOPIC
The BRIC Brazil, Russia, India and China idea was first conceived in 2001 by Goldman Sachs as part of an economic modeling exercise to forecast global economic trends over the next half century; the acronym BRIC was first used in 2001 by Goldman Sachs in their Global Economics Paper No. 66, “The World Needs Better Economic BRICs.
The New Development Bank was agreed to by BRICS leaders at the 5th BRICS summit held in Durban, South Africa on 27 March 2013.
On 15 July 2014, the first day of the 6th BRICS summit held in Fortaleza, Brazil, the group of emerging economies signed the long-anticipated document to create the $100 billion BRICS Development Bank and a reserve currency pool worth over another $100 billion. Both will counter the influence of Western-based lending institutions and the dollar. Documents on cooperation between BRICS export credit agencies and an agreement of cooperation on innovation were also signed.
BRICS AND RISING POWERS
Globally and politically, the influence of the BRICS countries – Brazil, Russia, India, China, and since 2011, South Africa – is rapidly increasing. They have been engaged in official and non-official development cooperation for decades, but their role as development actors has only recently been acknowledged by the development community.
These rising powers, once predominantly regarded as aid recipient countries, are now becoming more active as donors in their own right, raising important issues for debates on the future of international development cooperation.
Poverty reduction in low-income countries is increasingly influenced by the rising powers, a category that includes the BRICS grouping of Brazil, Russia, India, China and South Africa, as well as regional powers such as Mexico and Indonesia. Their importance is likely to grow still further as the financial crisis and longer-term global economic and political shifts reduce the relative weight of established donor countries such as the UK.
This event in London on 24 September will present new research from Future Agricultures on how agricultural policy in Sub-Saharan Africa is shaped, in the light of changing patterns of growth and investment agendas from within Africa and beyond.
Interest in African agriculture is high, with investment from the ‘Rising Powers’ and the US-led New Alliance for Food Security and Nutrition competing and interacting with regional, national and local plans and priorities.
The Government of Russia is undertaking efforts to recreate its own national aid delivery infrastructure and build up the institutional capacity of its organizations responsible for international development
The World Bank is assisting Russia in its attempt to build capacity for more effective and efficient development assistance by providing technical support to the 'Russia as a Donor Initiative' (RDI) program. This program is led by the Russian Ministry of Finance and the World Bank's techno.
In conclusion the from this perspective, the initiative of the NDB and the emergency reserve fund is a big success of the emerging economies. For the first time, they did not limit themselves to critique, but came with tangible results. In the not-so-distant past, such bold steps would have been unthinkable. This is a signal of a growing independence of the emerging world, represented by its most vibrant members, the BRICS. This is a signal of a growing independence of the emerging world, represented by its most vibrant members, the BRICS. An old dream of influencing the world of global finance has come true for the BRICS. It is hard to say at this point whether the practical significance of the BRICS bank will live up to the expectations.
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The latest BRICS Summit was held in Brazil. One announcement is the establishment of the BRICS Bank which will have its headquarters in China with India playing a presidential role.
Critical analyses the developmental role of BRICS especially the impact on the lives of those on the lower rung of society.
Writes Mhleli Mkhize
ical assistance is funded by the Government of UK, Department for International Development.