Countries sign deal to regulate Brics bank
In July last year, at the Brics meeting in the Brazilian city of Fortaleza, bloc members signed the Contingent Reserve Arrangement (CRA), aimed at determining the individual contributions
The heads of the central banks from the Brics countries—Brazil, Russia, India, China, and South Africa—ratified today (Jul 7) an agreement regulating the injection of capital into the New Development Bank (NDB), also known as Brics bank. The deal was signed in Moscow, where a gathering with the world's top emerging economies is taking place.
The so-called Inter-Central Bank Agreement (ICBA) lays down the procedures and obligations to be observed by the central banks under Brics. It also establishes how each country is to contribute for the new financial institution's authorized capital of $100 billion, of which $50 billion will be set as initial capital and should be available as soon as the institution becomes operational.
Each of the member states will contribute with part of the international pool by means of swap operations to be carried out by the central banks.
In July last year, at the Brics meeting in the Brazilian city of Fortaleza, bloc members signed the Contingent Reserve Arrangement (CRA), aimed at determining the individual contributions. Of the authorized $100 billion, China will chip in $41 billion. Brazil, Russia, and India are to put in $18 billion each; and South Africa, $5 billion.
The new bank is expected to fund infrastructure projects in member countries, but operations can also reach developing countries that might wish to borrow from the institution. The creation of the bank has been a topic of debate since 2012.
Translated by Fabrício Ferreira
Fonte: Countries sign deal to regulate Brics bank
