Monday, 7 March 2016

Shanghai HQ for BRICS New Development Bank (NDB) now operational


This article was posted on Business Day Live just 20 hours ago. Nice article:


Great news !!! And if you've never heard about the NDB before and are wondering why, you might need to go and check out this article as well...

 The reason why you've never heard about the NDB is actually a bit of a shocker !! : (



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Brics bank ‘open for business’
BY LINDA ENSOR, 07 MARCH 2016, 12:01


THE New Development Bank is formally "open for business," the Treasury said on Monday.

This follows the signature of an agreement late in February between China and the New Development Bank regarding the bank’s headquarters in Shanghai. The agreement completed all the necessary legal procedures for the bank to begin operations.

It is preparing for its first batch of projects, which could be launched in April. According to the bank’s media statements from Shanghai, it aims to lend up to $2bn this year.

The bank would place a lot of emphasis on the speed of its financing, the bank’s president, Indian banker KV Kamath said.

He said the first projects would be green energy ventures and infrastructure projects in member countries.

The Treasury said the bank was in the process of establishing its African regional centre in Johannesburg and had begun the process of recruiting staff. Former finance minister Nhlanhla Nene said on Monday that he had not received any further clarity about his position at the bank in SA, the reason given by President Jacob Zuma for his sudden removal from office in December. The president said Mr Nene had been removed as finance minister so he could head the regional centre in SA.

The 2016-17 budget review noted that SA’s first instalment of R2bn to the bank was paid in 2015 and made provision for further commitments of R11.8bn over the next three years (R3.75bn this year) to fulfil SA’s obligations to the bank.

Given the government’s straitened fiscal circumstances, this commitment has required the reprioritisation of spending in other areas.

With India providing the bank’s president, the bank’s four vice-president’s come from each of the other Brics member countries (Brazil, Russia China and SA). SA’s vice-president is Leslie Maasdorp, who, as chief financial officer, will be responsible for treasury and portfolio management as well as the finance, budgeting and accounting functions.

The bank was set up by Brics members with the aim of financing infrastructure and sustainable initiatives. It has been estimated that developing countries will need additional spending of almost $1-trillion a year for the next 20 years to meet their infrastructure requirements. It will have total capital of $100bn, 12.5% of which is to be paid in by the members in the first seven years, and a starting capital of $50bn, with each member country contributing $10bn.

© BDlive 2016


Background here:


New Development Bank BRICS

The New Development Bank BRICS (NDB BRICS), formerly referred to as the BRICS Development Bank, is multilateral development bank operated by the BRICS states (Brazil, Russia, India, China and South Africa) as an alternative to the existing US-dominated World Bank and International Monetary Fund. The Bank is set up to foster greater financial and development cooperation among the five emerging markets. Together, the four original BRIC countries comprise in 2014 more than 3 billion people or 41.4 percent of the world’s population, cover more than a quarter of the world’s land area over three continents, and account for more than 25 percent of global GDP. It will be headquartered in Shanghai, China. Unlike the World Bank, which assigns votes based on capital share, in the New Development Bank each participant country will be assigned one vote, and none of the countries will have veto power.
 http://ndbbrics.org/


BRICS countries launch New Development Bank

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Leaders from the BRICS countries – Brazil, Russia, India, China, and South Africa – formally launched a joint international development bank on Tuesday during their annual summit, held this year in the Brazilian city of Fortaleza. Headquartered in Shanghai, the bank will finance infrastructure and sustainability projects in BRICS and other emerging and developing countries. 
The New Development Bank, as it will be called, will have US$100 billion in initial authorised capital at its disposal. The BRICS countries will initially underwrite half that amount – US$50 billion – with each putting forward equal contributions of US$10 billion.
The rotating presidency of the bank will first go to India, leaders said in the Fortaleza Declaration, with Brazil chairing the bank’s first board of directors. Russia, for its part, will chair the first board of governors, while a regional centre will be set up concurrently in South Africa.

http://www.ictsd.org/bridges-news/bridges/news/brics-countries-launch-new-development-bank


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Overview

Since its inception, the BRICS has expanded its activities in two main streams of work: (i) coordination in meetings and international organization; and (ii) the development of an agenda for multisectorial cooperation among its members.

In relation to the BRICS coordination in international fora and organizations, the mechanism focusses on the economic-financial and political governance spheres. As to the first, the BRICS agenda prioritized G-20 cooperation, including the IMF reform. In the political realm, the BRICS advocate the reform of the United Nations and of its Security Council, aiming for more inclusive representation and a more democratic international governance. Moreover, the BRICS maintain a constant dialogue on the main issues on the international agenda.

Five years after the first Summit, in 2009, the intra-BRICS activities already cover 30 areas such as: agriculture, science and technology, culture, outer space, think tanks, Internet governance and security, social welfare, intellectual property, health, and tourism, among others.

The economic-financial sphere stands out as one of the most promising areas of activity for the BRICS. Two instruments of special importance were signed at the VI BRICS Summit (Fortaleza, July 2014): the constituent agreements of the New Development Bank (NDB) – aimed at the financing of infrastructure projects and sustainable development in emerging economies and developing countries – and the Contingent Reserves Arrangement (CRA) – which has the goal of promoting mutual support amongst the BRICS members in situations of instability in the balance of payments. The initial capital subscribed to the NBD was $50 billion and the authorized capital was $100 billion. The resources allocated to the CRA, in turn, will amount to $100 billion.

http://brics.itamaraty.gov.br/


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