The Brics emerging market bloc on Tuesday announced the signing of an agreement that paves the way for the establishment of a New Development Bank, to be headquartered in Shanghai, China, as well as an African regional centre of the bank, to be located in South Africa.
Plans are also in progress for the establishment of a Brics contingency reserve arrangement, to help any of the grouping's members if they are hit by a sudden loss of foreign capital.
The five members of the group - Brazil, Russia, India, China and South Africa - announced the plans in a declaration released following the sixth Brics summit in Fortaleza, Brazil.
According to the Fortaleza Declaration, the New Development Bank will have an initial authorised capital of US$100-billion, and its initial subscribed capital of $50-billion will be equally shared among the five founding members.
The first chair of the bank's board of governors will be from Russia, the first chair of its board of directors from Brazil, and the first president of the bank from India.
The bank, the declaration stated, is aimed at "mobilising resources for infrastructure and sustainable development projects in Brics and other emerging and developing economies".
"Based on sound banking principles, the New Development Bank will strengthen the cooperation among our countries and will supplement the efforts of multilateral and regional financial institutions for global development, thus contributing to our collective commitments for achieving the goal of strong, sustainable and balanced growth."