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Lower house of Brazil’s parliaments approves creating BRICS New Development Bank

May 22, 2015, 3:47 UTC+3 RIO DE JANEIRO
A Brazilian MP told that the bank will become "an alternative source of investment which will increase resources supply to both state and private companies and organizations in Brazil"
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RIO DE JANEIRO, May 22. /TASS/. The Chamber of Deputies of Brazil’s National Congress has approved the agreement on establishing the New Development Bank by BRICS countries (Brazil, Russia, India, China, South Africa), the lower house of Brazil’s parliament said in a report published on its official website on Friday.

The agreement on the multilateral development bank, seen as an alternative to the US-dominated World Bank and International Monetary Fund, was signed in mid-July 2014 at the 6th summit of five major emerging national economies in Fortaleza, Brazil.

The New Development Bank will finance infrastructure projects and projects of sustainable development in the BRICS countries and developing countries.

The bank’s founding parties will be the BRICS countries, which are to be vested with special authority unlike other members. The president of the bank will be elected only upon submission by one of the founding parties and the position will rotate every five years among the BRICS nations.

The key decisions in the bank’s management bodies will be taken by a majority of the votes cast by the founding nations.

A Brazilian MP told the plenary session that the bank will become "an alternative source of investment which will increase resources supply to both state and private companies and organizations in Brazil"." BRICS countries share "42% of the planet’s population, 26% of the Earth’s surface and 27% of global economy," the MP noted.

The agreement on establishing the New Development Bank is open for other countries - UN member - to join. The BRICS New Development Bank will have an authorized capital of $100 billion, including $50 billion in dedicated capital and $10 billion in paid-in capital ($40 billion paid on demand). The bank will be headquartered in Shanghai.

The Brazilian parliament also approved the draft law on creating a foreign currency reserve pool. The foreign currency reserve pool of the BRICS will total $100 billion. The BRICS member states will be able to urgently replenish their liquidity from this pool in different proportions to resolve problems with their balances of payments.

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