BRICS seals development bank deal

BRICS nations Tuesday agreed to set up a development bank, as part of the emerging economies' efforts to reshape the existing international political and economic system.

The creation of the bank was announced by South Africa's finance minister Pravin Gordhan hours before Tuesday's summit of the BRICS, which groups Brazil, Russia, India, China and South Africa, in the South African port city of Durban, without revealing details.

The bank is expected to provide loans for infrastructure construction in the developing world.

AFP commented that it is the first time since the inaugural BRICS summit four years ago that the group has matched rhetorical demands for a more equitable global order with concrete steps.

Fan Yongming, director of the Center for BRICS Studies at Fudan University, told the Global Times that the establishment of the development bank marks a step forward in the institutionalization of the group's mechanisms. BRICS is also mulling the creation of its own business council and think tank.

Grant-Makokera, South African Institute of International Affairs' program head for economic diplomacy, told Reuters that BRICS offers developing states other options for aid and investment as an alternative to the old Western partners.

But Wang Yizhou, a deputy dean of the School of International Studies at Peking University, told the Global Times earlier that the bank may have some overlapping functions with the World Bank, but it would be a supplement rather than an alternative.

The BRICS countries account for 42 percent of the world's population, 20 percent of global GDP and 15 percent of global trade, according to data from the Xinhua News Agency.

Fan said the BRICS, the acronym of which was first invented as an investment concept, now carries more weight in the political arena.

Following the global financial crisis in 2008, the world has been undergoing changes in the rules of the international political and economic system.

As the spearhead of developing countries, BRICS represents the interests of more than 80 percent of the world's population, and would speak on behalf of them on the platform of BRICS summits to defend their interests, Fan said.

However, despite the emerging countries' desire to reshape the international order, their ability to do so has been brought into question, especially after seeing slowed economic growth in the past year or so.

Su Hao, director of the Asia-Pacific Research Center at the China Foreign Affairs University, told the Global Times that the five countries, which all aimed to build a multipolar world order, now have some political weight, but not in a decisive manner.

"They are pushing for changes slowly and incrementally. We can only expect it to be a long-term process," said Su.

In recent months, some opinions from the West have cast doubt over whether the emerging countries could maintain their prospects.

Fan expressed confidence in the group, noting that the West's expression of pessimism was due to their concerns that the BRICS's desire to change the political order would challenge their interests. "We have every reason to believe that the BRICS would maintain their momentum despite the pessimism."

This year's BRICS summit will be joined by African leaders for promotion of regional development and integration, the first time this has happened since the inaugural summit.

Earlier in the day, Chinese President Xi Jinping met his South African counterpart Jacob Zuma in Pretoria, the administrative capital of the country. The two leaders vowed to advance the comprehensive strategic partnership between the two countries, and oversaw the signing of agreements on trade, economic cooperation, energy and minerals, and infrastructure construction.

In a joint communiquéreleased following the meeting, the two countries agreed to prioritize bilateral ties in their respective foreign policies.

According to AFP, Zuma said after talks with Xi, "We view China's success as a source of hope and inspiration as we engage with the task of finding our own solutions for bringing about a better future."

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