Africa
BRICS New Development Bank Battling Multipolar Challenges -By Kestér Kenn Klomegâh
In May 2022, the New Development Bank set up a regional office in India in the state of Gujarat with the goal of financing and observing infrastructure projects in both India and Bangladesh. In May 2023, Saudi Arabia expressed its intention to join the NDB. The bank is headquartered in Shanghai, China. The first regional office of the bank was opened in Johannesburg, South Africa in 2016. Subsequently, regional offices were established in São Paulo in Brazil, Ahmedabad in India and Moscow in the Russian Federation.
On the sidelines of the St Petersburg International Economic Forum (SPIEF), Russian President Vladimir Putin has held a working discussion with Dilma Rousseff, President of the New Development Bank (NDB) established by BRICS countries. According to official reports made available by the Kremlin, Putin urged the bank to consider seriously the adoption of new financial payment systems and the possibility of settlements in national currencies.
“There are issues that require special attention. I mean the expansion of the possibility of settlements in national currencies, and further joint efforts to create a digital platform for settlements and investments,” Putin stressed in his comments at the meeting, and reminded that this questions was thoroughly discussed at the last summit of BRICS leaders in Kazan, Tatarstan.
While congratulating her re-election to the position of the head of the New Development Bank, which implies that all members of the bank highly appreciate her work, Putin further underlined that currently the New Development Bank (NDB) has approved and financed approximately 120 projects worth US$39 billion.
In her brief response, Dilma Rousseff, President of the New Development Bank (NDB), informed and confirmed the fact that the Russian Federation proposed her candidacy for re-election as the NBR president. “For my part, I will do everything possible and make every effort to fulfil my duties in this post as best as possible,” Rousseff told Putin in the presence of the Deputy Chief of Staff of the Presidential Executive Office Maxim Oreshkin, Finance Minister Anton Siluanov, and Central Bank Governor Elvira Nabiullina.
Established in 2015 by the BRICS leaders, the New Development Bank (NDB) has since faced multitude of challenges, especially now with geopolitical changes and emerging economic hurdles. “Of course, we face a number of challenges. These are mutual settlements in national currencies, as well as the creation of digital platforms for the implementation of mutual settlements, including in local currencies. Currently, there are various mechanisms that make it possible to tokenize mutual settlements,” explained Dilma Rousseff, President of the New Development Bank.
Rousseff, in addition, referred to the second very important issue, including the expansion of member countries of the international development bank, as well as the addition of new members partners of the bank. Two countries have already been selected as new members: Uzbekistan and Colombia. And two more countries are still under consideration: Ethiopia and Indonesia.
According to media reports, other multilateral development institutions, including the World Bank, have expressed an intention to work together with the NDB. In September 2016, NDB and World Bank Group signed a memorandum of understanding on cooperation and it was announced that the NDB and WBG’s cooperative efforts focusing primarily on infrastructure development in BRICS member countries.
The New Development Bank (NDB), formerly referred to as the BRICS Development Bank, is a multilateral development bank established by the BRICS (Brazil, Russia, India, China, and South Africa). According to the agreement on the NDB, “the Bank shall support public or private projects through loans, guarantees, equity participation and other financial instruments.” Moreover, the NDB “shall cooperate with international organizations and other financial entities, and provide technical assistance for projects to be supported by the bank.”
In May 2022, the New Development Bank set up a regional office in India in the state of Gujarat with the goal of financing and observing infrastructure projects in both India and Bangladesh. In May 2023, Saudi Arabia expressed its intention to join the NDB. The bank is headquartered in Shanghai, China. The first regional office of the bank was opened in Johannesburg, South Africa in 2016. Subsequently, regional offices were established in São Paulo in Brazil, Ahmedabad in India and Moscow in the Russian Federation.
—
