BRICS (a group composed of the leaders of Brazil, Russia, India, China and South Africa) has created a Shanghai based development bank; similar to a mini IMF (International Monetary Fund) and the Eastern Worlds answer to the Western World Bank.
Plans were announced last year and reached fruition today at the meeting in Fortaleza.
Initial capital of $50 billion will be provided in equal shares by each country; although $100 billion is possible in the near future.
Per the summit declaration – “the bank will help emerging and developing nations mobilize resources for infrastructure and sustainable development projects” (AFP – Laurent Thoment)
What isn’t declared is that along with BRICS concerns over progress in Ukraine, Iraq, Syria and Palestine-Israel; the formation of the bank points to the ability and willingness of the coalition to compete with the U.S. and other Western powers in world banking.
Certainly, the threats voiced by the US for economic sanctions on Russia play a part in their involvement in BRICS summits. The upcoming BRICS South America summit launching a China-Latin America forum indicate a potential rift in the North/South American markets. Beijing is increasingly interested in this area; traditionally thought of by many as an extension of the United States. Potential clashes and reactions will be something to watch.