Russia and China Spearhead BRICS Development Bank

A BRICS Development Bank will be launched this coming week, and expected to become operational in 2016. The new global banking organization will largely be bankrolled by Russia, China and India, three of the five BRICS nations, the other two being Brazil and South Africa. The organization is being developed largely as an alternative to current global finance and investment organizations The World Bank and The International Monetary Fund, both of which have been criticized by leading BRICS members Russia and China. The new banking organization will, at least in the beginning stages, be designed to assist with financing in other BRICS states, though its stated goal is to serve members of the United Nations as well.

Russia’s own Finance Minister outlined the new organization’s funding, and stated that each of the five members will invest an initial $2b each to the bank’s first seven year stretch of funds. The bank has limited its size, at least initially, to $100b in capital, and will most likely be headquartered in New Delhi or Shanghai. Russia and China have long expressed an interest in lessening the influence of organizations such as the WB and IMF in order to strengthen their own currencies and lessen their vulnerability to sanctions imposed by the West, such as those imposed by the United States during the Ukraine crisis.

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News Briefs:

  • US Officials are pressing Ashraf Ghani and Abdullah Abdullah for a framework to review disputed vote counts, as part of mounting concern that the current runoff debacle will mark a return to civil strife and affect bilateral security arrangements with the United States in the future. Abdullah Abdullah has rejected the official IEC vote count that put his percentage of support at 43.6% as opposed to Ghani’s overwhelming 56.4%. The main concern at this point is that the loser of the election will set up a parallel government, which could derail any potential agreements.
  • The Turkmenistan Afghanistan Pakistan India pipeline (TAPI) contract has reached the final stage during a meeting in Ashgabat, Turkmenistan. The Pakistani Petroleum Ministry said the next step would be to push ahead with construction and awarding the contract to EPC and oil and gas multinational companies that are currently lining up to bid on the lucrative contract. Currently, Chevron and Exxon Mobil are at the top of the list to acquire it, with the winning firm obtaining rights to operate the pipeline in addition to financing and construction.
  • A Moscow think-tank has published a study saying that 13 people were killed and 61 injured in ethnically motivated attacks in Russia for the first half of 2014. The Sova Center for Information and Analysis said that the deadliest attacks occurred in or around Moscow, where five people were killed by suspected ultranationalists, followed in a close second by St. Petersburg.

One thought on “Russia and China Spearhead BRICS Development Bank

  1. Pingback: The China Box » China’s Overseas Investments, Explained in 10 Graphics

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