At a time developed countries are contending to ward off fudges in their economies, emerging market leaders - Brazil, Russia, India, China and South Africa (BRICS) club of nations decided to redefine their role and flex some muscle.
The five nations have finally shaken hands on a major decision. They, on Wednesday decided to launch a development bank to fund global infrastructure projects to address the gap in long-term financing and foreign direct investment, especially investment in capital stock. Side by side with the Bank, the BRICS summit also saw action on another front - creation of a Contingent Reserve Arrangement (CRA) amongst BRICS countries. Already, BRICS has set aside a $100 billion to sow the seeds of an alternate financial structure for developing countries. This is a direct challenge to the World Bank and the International Monetary Fund (IMF), which have been accused of bias and inequity. It also reflects frustration among emerging nations at having to rely on these institutions largely perceived as tools of western domination. The reserve pool of the proposed central bank would be available to emerging economies facing balance of payments crises or be tapped to stabilize economies during crises.
For a start, the bank would use $50 billion of seed capital shared equally between Brazil, Russia, India, China and South Africa but would undoubtedly be dominated by China. It would be the first institution of the informal forum started in 2009 amid the economic meltdown to chart a new and more equitable world economic order. Clearly, leaving Nigeria behind is an attestation to the country's leadership deficit and lack of foresight at a time resource-rich countries are pooling together for greater relevance in the globalisation process towards becoming world powers.
Russian President Vladimir Putin gave support for the bank but cautioned "it must work on market principles." India's trade minister said BRICS will "have a defining influence on the global order of this century." The five countries represent a fifth of global GDP and share high growth and geopolitical importance in their separate regions, but have struggled to find common ground that would convert their economic weight into joint political clout. It is, however, sad that Nigeria is not part of this commendable leap-forward among countries of the South with whom she had shared similar antecedents and promise years ago.
It remains to be seen how Nigeria will seek to compete with South Africa, when the continent is being discussed in the global scheme of things. Nigeria, hitherto regarded as the regional 'giant', is asleep on issues of international economic relations, while her arch-rival, South Africa is wide awake, working and networking across the globe.