BRICS countries look to set up their own development bank

THE BRICS economies yesterday discussed setting up a new development bank that would rival the IMF and the World Bank, though they failed to reach an agreement.

Brazil, Russia, India, China and South Africa represent together a fifth of global GDP but have struggled to convert their economic weight into political clout in the international arena.

At yesterday’s Durban summit, the group’s fifth since 2009, the heads of state discussed plans to create a joint foreign exchange reserves pool as well as the infrastructure bank.

“There is positive movement, but there is no decision on the creation of the bank,” Russian finance minister Anton Siluanov said after a meeting with his counterparts.

China and Brazil agreed yesterday to swap up to the equivalent of $30bn in each other’s currencies if need be so that their commercial ties will not suffer if a new banking crisis causes dollar trade finance to dry up.

The three-year agreement, signed before the start of the summit, marked a step by the two largest economies in the emerging powers group to change global trade flows.