World Bulletin/News Desk
The BRICS, the group of fast-growing emerging markets, meets for the first time on African soil in the South African city of Durban. At their fifth summit, they are to discuss the setup of a development bank to overhaul the global financial system.
BRICS emerging powers sought a deal on setting up a development bank that would rival Western-backed institutions, trying to iron out significant differences ahead of a leaders' summit in Durban.
The grouping of Brazil, Russia, India, China and hosts South Africa are racing to elaborate on proposals for an infrastructure-focused lender that would challenge seven decades of dominance by the World Bank.
The umbrella theme for the two-day summit is called “BRICS and Africa - Partnership for integration and Industrialization."
Economic data shows that the grouping of Brazil, China, India, Russia and South Africa now account for 25 percent of global GDP and 40 percent of the world's population.
The major outcome of this year’s summit is expected to be the announcement of the formation of the BRICS Development Bank (BDB). Originally proposed as an institution at last year’s New Delhi summit, the organization’s “strategic goal is to transform the aging international financial architecture,” Mikhail Margelov, President Putin’s envoy to Africa was quoted by Bloomberg.
If the leaders succeed it would be the first time since the inaugural BRICS summit four years ago that the group matches rhetorical demands for a more equitable global order with concrete steps.
That would send a loud message to the US and European nations that the current global balance of power is unworkable.
Diplomats say it could start with $10bn seed money from each country, but the exact role of the bank is up for debate, according to Al Jazeera.
China, Brazil sign deal to trade in own currencies
Meanwhile, BRICS members China and Brazil agreed on Tuesday to trade in their own currencies the equivalent of up to $30 billion per year, moving to take almost half of their trade exchanges out of the U.S. dollar zone.
The agreement, due to last three years and signed hours before the start of a BRICS summit in Durban, South Africa, marked a step by the two largest economies of the emerging powers group to make real changes to global trade flows long dominated by the United States and Europe.
"Our interest is not to establish new relations with China, but to expand relations to be used in the case of turbulence in financial markets," Brazilian Central Bank Governor Alexandre Tombini told reporters after the signing.
Trade between the two countries totalled around $75 billion in 2012. Brazilian officials have said they hope to have the trade and currency deal operating in the second half of 2013.
At the summit, Brazil, Russia, India, China and South Africa are widely expected to endorse plans to create a joint foreign exchange reserves pool. They are also due to discuss trade and investment relations with Africa.
Apple, Microsoft, Alphabet, Cisco and Oracle hold about $504B, approximately one-third of all corporate cash in the United States
The Fund's head says 'corruption has a pernicious effect on the economy'
Exit would cost average monthly salary for each household, Organization for Economic Cooperation and Development says
Firms to see deterioration in credit metrics as low oil prices impact cash flows
OPEC exporters as well as other non-OPEC producers, including Russia, fail to agree on oil output freeze
Moody's has upgraded Argentina's credit rating after a US appeals court ruling this week cleared the way for Buenos Aires to proceed with the biggest debt issue by an emerging market country in 20 years.
Ahead of Doha meeting, OPEC says 'hurdles prevail as oversupply persists and inventories remain high'
Kuwaiti OPEC head says Russia and OPEC are likely to agree on oil output freeze
'The good news is that the recovery continues; we have growth; we are not in crisis,' Christine Lagarde says
The meeting is a 'follow-up' to last month's talks between Qatar, Russia, Saudi Arabia and Venezuela when they proposed an accord to freeze oil output at January levels
'They are not trimming output, only keeping it at the same levels...this is the same unchanged policy,' one expert says
Iran joining Venezuela, Saudi Arabia, Qatar and Russia in freezing oil output levels
According to the ratings agency Moody’s, Iran is fiscally and structurally well placed to come back into the global economic scene
PM Davutoglu meets the heads of the world's largest companies as he promotes Turkish economic interests at World Economic Forum
Fund cuts global growth forecasts for both 2016 and 2017 by 0.2 percentage points
'Runaway inequality has created a world where 62 people own as much wealth as the poorest half of the world’s population'