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BRICS: Will new bloc’s Development Bank bring new development model?

During the last meeting of Heads of State and Government of Brazil, Russia, India, China and South Africa (BRICS Summit), held in Durban, South Africa, in 2013, BRICS’ leaders announced the decision to establish, already in 2014, the BRICS Development Bank. For the next BRICS summit, to take place in the city of Fortaleza, Brazil, on July 14, 15 and 16, they announced signing of a formal agreement on this Bank, but there are still a lot of expectations and doubts about the basis on which it will be constituted.

The new Bank can be analyzed from a range of angles. One of them is from the national experiences since we know that all the BRICS countries have their own National Development Bank and, besides some particularities and their different sizes, all of them have experience in defining development politics, creating strategic credit lines, financing projects and especially in projecting their countries’ economic potential in the long term. Although there are differences among them these banks have a certain standard of performance, with great emphasis on big infrastructure projects, aiming a greater dynamism of their exports, which normally are concentrated on primary products.

Within this context, IBASE (Brazilian Institute of Social and Economic Analysis) has been developing studies and debates with different organizations and social movements from the BRICS countries, in order to understand and analyze these national experiences and their major implications, both from the economic point of view (see “Development Banks in the BRICS Countries”) as from the social and environmental politics point of view (see “Transparency Policies and Socio-environmental safeguards”).

From the initial perception of how the actual BRICS countries’ configure their own visions of growth and how their own Development Banks work, we intend to think about a new proposal, more inclusive than those used by their current Development Banks, which takes into account the regions’ and countries’ specific needs. Moreover that also ensures a development model that is more social and consolidates the South-South cooperation towards a more equal model, while not prioritizing growth over social and environmental damages.

A new Bank has the challenge of proposing a new development path, concerned with the countries’ social and infrastructural deficits, aiming a social inclusion that allows structural change and not only a growth based on exports. Besides that difficult task, it is necessary to incorporate better human and environmental rights practices and norms. Years of impacts and conflicts by affected people and communities with the National Banks cannot be ignored with the creation of this New Bank. On the contrary, it must incorporate practices and norms that not only include the actual progress that Development Banks have made in this regard, but also address their faults and the degree to which they still engage in practices that reflect a lack of respect for environmental, social and human rights standards.

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March 2017
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