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BRICS Finance Ministers Fail to Agree on Development Bank

27 March 2013 02:59 (UTC +04:00)

Baku-APA. Finance ministers of the BRICS countries failed to reach a final agreement on the establishment of the Development Bank, but agreed to continue talks on the issue, Russian Finance Minister Anton Siluanov said, APA reports quoting RIA Novosti.

According to him, the top finance officials from Brazil, Russia, India, China and South Africa have not decided on the administration of the mooted bank, whether it would be proportional to depositions or equally divided between the member states.

“We have discussed this issue today and prepared a list of questions on this matter. On the whole, we agreed to continue work on the establishment of the BRICS [Development] Bank,” Siluanov said after the meeting of the finance ministers at the fifth BRICS summit in South Africa’s Durban.

The idea of setting up a BRICS development bank as an alternative to the Western-dominated World Bank and the International Monetary Fund came from India at the 2012 meeting of the organization’s finance ministers in Mexico.

Brazilian Foreign Trade Minister Fernando Pimentel said last week that BRICS member states reached a basic agreement on setting up the Development Bank with seed capital of $50 billion, but it has to be decided how much each country would contribute.

A spokesman for the US Department of State said the United States, which plays a weighty role in the World Bank, would have to take a look into the possibility of the BRICS bank establishment.

“You know our support, obviously, to the World Bank and other multilateral development institutions. But this is something we’re going to have to take a look at,” Patrick Ventrell said answering whether the BRICS bank would be a challenge to the World Bank.

BRIC was founded by Brazil, Russia, India and China in 2009 during the economic meltdown in the West, and was joined by South Africa a year later to change the name to the current BRICS. According to the World Bank, BRICS member states are driving almost 50 percent of the global economic growth.