Published on : Jul 21, 2015
As an alternative to the World Bank and International Monetary Fund, the US$100 billion bank floated by the BRICS nations has been finally launched in Shanghai. The bank had been proposed with the aim to fund infrastructure projects in the BRICS nations and offer them tailor-made services. The New Development Bank (NDB) was opened at China’s financial capital Shanghai, in the presence of bank’s President KV Kamath, China’s Finance Minister Lou Jiwei, and Shanghai Mayor Yang Xiong.
Kamath stated that the BRICS nations need to cooperate for the bank to achieve its aim. He would be leading the bank for the first five years. He is confident that the bank would meet up to people’s expectations. BRICS nations Brazil, Russia, India, China, and South Africa decided upon the New Development Bank at the 7th BRICS Summit held in July this year. The idea behind establishing the bank was to finance infrastructure projects in member countries.
At the opening of the bank, China’s Finance Minister Lou Jiwei stated that the bank will meet the urgent demand of the member countries in infrastructure construction. He stressed that rather than challenging the international banking system, the bank would complement the existing global banking standards.
The New Development bank will be started with an initial capital of US$50 billion which will be stretched to US$100 billion in the span of next couple of years. Each of the member nation will contribute equally in establishing the startup capital. The BRICS nations are home to 42.6% of the world’s population and account for one-third of the global land area. The combined GDP of the BRICS nations constitute one-fifth of the total GDP across the globe. The bank is also backed by the Asian Infrastructure Investment Bank floated by China.