3 weeks ago
BRICS Leaders Back NDB Expansion and New Financing Mechanisms
BRICS countries want their development bank to include more members.
They also want the bank to have more money and new ways to fund projects.
These projects could involve clean energy, transportation, water, schools and other social infrastructure.
The bank is also being encouraged to lend more in countries’ own currencies.
BRICS countries welcomed a new portal for sharing development ideas and lessons.
They called for changes to the International Monetary Fund and World Bank so developing countries have a stronger voice.
They also supported guarantees that could make infrastructure projects cheaper to finance.
Finally, they want their emergency financial safety arrangement to respond more quickly during crises.
BRICS leaders agreed to expand membership of the New Development Bank and create new financing mechanisms for the Global South.
The New Delhi Declaration called for faster processing of membership applications and greater resource mobilization, innovation, local-currency lending and infrastructure investment by the NDB.
The NDB finances clean energy, transport, water and sanitation, social infrastructure, and projects addressing the digital divide.
BRICS supported reforms to International Monetary Fund quotas and governance, including greater representation for emerging and developing economies.
Members welcomed progress on multilateral guarantees and said the Contingent Reserve Arrangement should become more flexible during crises.
- Who
- Leaders of the BRICS countries and members of the New Development Bank.
- What
- They agreed to pursue NDB membership expansion, stronger financing capacity and new development-financing mechanisms.
- Where
- At the BRICS summit associated with the New Delhi Declaration; the measures are intended to support the Global South.
- When
- The agreement was announced on Saturday in the New Delhi Declaration.
- Why
- To finance infrastructure and sustainable development, reduce inequality, improve economic integration and strengthen financial support during crises.
Key facts
- Institution
- The New Development Bank, also known as the BRICS Bank, operates under a mandate established at the 2014 BRICS Summit.
- Current members
- The bank includes Brazil, Russia, India, China, South Africa, the United Arab Emirates, Colombia, Uzbekistan, Egypt, Algeria and Bangladesh.
- Prospective members
- Uruguay, Ethiopia, Angola and Zimbabwe are listed as prospective members.
- Priority sectors
- The NDB focuses on clean energy, transport infrastructure, water and sanitation, social infrastructure and bridging the digital divide.
- New initiative
- The BRICS Multilateral Guarantees initiative aims to improve project creditworthiness, lower financing costs and attract private investment.
- Financial safety net
- The Contingent Reserve Arrangement is being amended to become more flexible and responsive during crises.
- Global financial reforms
- BRICS called for IMF quota and governance reforms and a World Bank shareholding review to strengthen representation of emerging and developing economies.
Quotes
BRICS leaders
Leaders of the BRICS countries, through the New Delhi Declaration
“We encourage further efforts by the Bank (NDB) to expand steadily its capacity to mobilise resources, foster innovation, expand local currency financing, diversify funding sources, and support impactful projects that advance sustainable development, reduce inequality, and promote infrastructure investments and economic integration.”
financialexpress.com
“We reiterate the urgent need to reform the Bretton Woods Institutions (BWI) to make them more agile, effective, credible, inclusive, fit for purpose, unbiased, accountable, and representative, to enhance their legitimacy.”
financialexpress.com
Sources
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