The New Development Bank – NDB – (formerly known as the BRICS Bank) an initiative started by the BRICS nations(Brazil, Russia, India, China and South Africa) in 2011, finally comes to fruition as the members have elected their Board of Governors. The first President of the NDB will be Mr. K. V. Kamath, former CEO of ICICI Bank one of India’s top private lenders. Mr. Kamath said in a statement last week “I hope to work with BRICS and other member countries of the NDB over the next few months so as to build pipelines by April 2016”
The first Chairman of the Board is the Russian Finance Minister Anton Siluanov. Although the Bank will be headquartered in Shanghai, it will hold its opening session in Moscow on July 7th, 2015 as confirmed by Russian Deputy Finance Minister Sergei Storchak at the St. Petersburg Economic Forum on Thursday June 19th, 2015.
The Bank decided on the name change from BRICS Bank to NDB, in anticipation of more countries joining the five-member group in the future and not just limiting it to Brazil, Russia, India, China, and South Africa.
By selecting Mr. Kamath, a banker himself, as its first president, the NDB is sending out a clear message that the organization will be managed primarily as a bank to assist member nations. In China, the municipal government of Shanghai has given strong backing to the NDB since it is the first major international organization headquartered in Shanghai as well as it is the first global financial organization with its headquarters in China.
The NDB’s newly announced Vice President, Paulo Nogueirga Batiista of Brazil who also serves as Brazil’s envoy to the IMF said at a BRICS Business Forum that the BRICS are “not fully satisfied with the international financial architecture, not fully satisfied with the role that our countries are allowed to have at the IMF and the World Bank”.
“Our countries are very active in IMF….We work together at the IMF… Despite this active involvement in the Washington institutions, our countries have begun to realize that we need to do our own thing,” said Batista.
The BRICS nations are demonstrating their strength lies in their unity and this is evident from the group’s growth rate still being above many of the developed nations and also in their economic and political strength in as much as the decision from European countries to join the China-led Asian Infrastructure Investment Bank(AIIB). In summary, the BRICS nations seem to be taking the lead in three major financial ventures – the establishment of the NDB (USD $ 100 billion) the AIIB, and the BRICS currency reserve fund (USD $100 billion) and can see success lies ahead.