BRICS Development Bank

by Developed Africa 10. July 2014 09:00

Its been 2 years in the making, but it is expected for the BRICS countries to announce the launch of their development bank at their summit next week.

An announcement by Russian Finance Minister Anton Siluanov yesterday has confirmed that the BRICS will announce the launch of their "New Development Bank" at their summit in Brazil 16th-17th July. The development bank is planned to open in 2016, and is being created to counteract the move away from investing in developing economies by investors. Plans are for the bank to target projects within the BRICS economies, but may also give help to new members of the UN. The dissatisfaction with the Bretton Woods institutions has been clear from the outset of the BRICS bloc, but is becoming clearer, for aswell as the bank, they are creating a fund to mimic the IMF:

BRICS will also consider creating a fund, which Mr Siluanov dubbed a "mini IMF"...The fund is designed to serve as an emergency coffer for BRICS if a member suffers from capital flight or the risk of currency depreciation."

Last year we were left without solid information on how the bank will be funded and led, we now know that the funding will be divided equally between the bloc's countries, with an inital $10 billion each, with $40 billion in guarantees; and the chairman position will rotate between the nations every 5 years.

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