Guest post: a new BRICS bank to mark global shift – beyondbrics - Blogs - FT.com:
"Leaders of the BRICS (Brazil, Russia, India, China and South Africa) nations are committed to the creation of a new Development Bank for infrastructure and sustainable development. Details of the bank’s operations are expected at the forthcoming BRICS summit to be held in Brazil this July.
The bank is set to play an important role in helping to meet needs for an estimated US$1tn or more in annual investments in infrastructure and sustainable development. The future growth prospects of the BRICS countries will depend in large measure on these investments materialising.
What are the likely challenges this institution will face as it moves from the design to the operational stage?
The first involves the scale of lending. The BRICS bank needs to be large enough at the outset to make a meaningful impact. It has been reported that officials from Brazil, the Russian Federation, India, China and South Africa have agreed to an initial capital base of US$50bn of which 20 per cent or US$10bn would be paid-in. This is a good start but further scaling-up will be needed.
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