BRICS will build the world’s future. Yes, BRICS: Brazil, Russia, India, China and South Africa.
For decades these emerging market powerhouses have slowly grown their economies expanding into untapped industries and resources the developed world dared not explore.
These countries that largely built up its markets through loans from the world’s largest international financial institutions the World Bank and International Monetary Fund (IMF) now look to rival them with the creation of a new development bank.
The name BRIC was first coined by Goldman Sachs in 2001 as the U.S. investment bank sought to group together four very different nations with very similar fast-growing economies.
Just eight short years after its financial christening, the group held its first summit in 2009 and since grew to include South Africa in its coalition at its third summit in China last year.
In the nations’ fifth summit, themed “BRICS Partnership for Global Stability, Security and Prosperity” set a progressive and aggressive agenda in its formal statement the Delhi declaration.
During the meeting the BRICS Bank, projected to open in 2013, set the funding development projects and infrastructure of developing nations as its top priority.
With the decision to form a South-South development bank these five nations have made a step that could undoubtedly change international development and tip the balance of the scales of global governance in the Global South’s favor.
Though BRICS Bank would present competition (perhaps even stiff competition as evidenced by China’s developmental dominance) to its predecessors the IMF and World Bank, its leaders have publicly responded favorably to the creation of a development institution for and by the developing world. Backed with support from the developed and developing world, outgoing World Bank president Robert Zoellick stated on record that to not support the BRICS Bank would be a “mistake of historic proportions.”
While the world’s newest financial institution preps for its inauguration, it looks to bring development issues facing the African continent to the forefront. The recent addition of South Africa to its core investment groups remains no coincidence as the continent represents an abundance of resource wealth and growth potential.
In addition to potentially bolstering the intra-regional trade from $212 billion to its target goal of $500 billion by 2015, a BRIC-led development bank could create an even greater advantage for African markets looking to gain access into richer nations.
President Jacob Zuma of South Africa and President Dilma Roussef of Brazil have each denounced repeatedly denounced unfair practices in international trade like the distortion of Western agricultural subsidies and the inflation of currency, which dramatically raise prices for developing economies rendering them unable to compete.
Riding the wave of great momentum, enthusiasm, and capital, the BRICS Bank holds a great deal of promise in granting developing economies a bigger slice of the global market pie. Yet several questions loom over its newly minted approach to capital and development such as the global recession and the motives of nations like China that has come under harsh criticism for its development projects in Africa that do not come with the same requirements for protection of the environment and child labor laws the IMF and World Bank demand.
Even though the future success of the developing world owned bank cannot be determined and the motives of a rising “Chinese empire” remain unclear, one thing is certain — these BRICS won’t be knocked down anytime soon.
Jamila Aisha Brown is a freelance writer, political commentator, and social entrepreneur. Her entrepreneurship, HUE, provides consulting solutions for development projects throughout the African diaspora. You can follow her on Twitter and engage with HUE, LLC.