The Chinese Parliament has ratified the creation of the BRICS Development Bank. The New Development Bank was conceived as an alternative to Western financial institutions such as the World Bank.
The new bank will provide money for infrastructure and
development projects in BRICS countries, that is Brazil, Russia,
India, China and South Africa. Each nation will have an equal say
in the bank’s management, regardless of GDP size.
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investor in 5ys – research
Each BRICS member is expected to contribute an equal share in
establishing a startup capital of $50 billion, with a goal of
reaching $100 billion in capitalization. The BRICS bank will be
headquartered in Shanghai, with India presiding as president
during the first year, and Russia serving as the chairman of the
representatives.
China has pledged to contribute a total of $41 billion to the NDB
bank, which will give it the largest voting rights, at 39.5
percent, Reuters reports.
The agreement has already been ratified in India and Russia.
In China, the creation of the NDB bank, also known as the BRICS
Bank, has been approved by the Standing Committee of the National
People’s Congress at its meeting that runs until July 1.
It has been agreed that an African regional center of the NDB
bank will be established in South Africa.
“BRICS bank can be world-changing”. Analysis of basis of
financial firepower of BRICS bank. http://t.co/aVKKx9bG0D pic.twitter.com/3iJLYcc5Hk
— John Ross (@JohnRoss43) June
15, 2015
The launch of the BRICS bank is seen as a first step in breaking
the dominance of the US dollar in global trade, as well as
dollar-backed institutions such as the International Monetary
Fund (IMF) and the World Bank, both US-based institutions that
BRICS countries have little influence within.
South Africa is expected to present ratification documents in
July during a meeting of BRICS countries in the Russian city of
Ufa.
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BRICS represents 42 percent of the world’s population and roughly
20 percent of the world’s economy based on GDP, and 30 percent of
the world’s GDP based on PPP, a more accurate measure of real
economic performance. Total trade between the countries amounts
to $6.14 trillion, or nearly 17 percent of the world’s total.
The other bank being promoted by Beijng as an alternative to
existing development institutions, such as the IMF and the World
Bank, is the new Asian development bank, known as the Asian
Infrastructure Investment Bank, created in October 2014. Britain
and Germany are listed among its 57 member states.