BRICS bank should help the poor

At their summit in Fortaleza, Brazil, last week, the leaders of BRICS (Brazil, Russia, India, China and South Africa) announced the details of the much anticipated "New Development Bank", which will be headquartered in Shanghai and have an initial subscribed capital of $50 billion, and the $100-billion Currency Reserve Arrangement.

The idea of a BRICS development bank, to serve as a counterweight to the traditional donor countries and the US-EU led financial institutions like the World Bank and the International Monetary Fund, was first mooted at the 2012 BRICS summit in New Delhi.

At the Durban summit in South Africa last year, the BRICS member states announced their intent to launch the bank in 2014. Little else was revealed to the international community other than an agreed focus on "mobilizing resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries", and in a manner that will "supplement the existing efforts of multilateral and regional financial institutions for global growth and development".