16 July 2014

South Africa: Banking On Brics - the Developing World Gets a Credit Card


A twenty-first century truism: you know you've made it when you're due for a headquarters in Shanghai. So it is with the imaginatively named New Development Bank, a.k.a. BRICS Bank, a lending institute designed to end Western global dominance and finally assert the rise of the South. Or something.

The world is a funny place. At the turn of the century, one of the evil geniuses at Goldman Sachs came up with a fancy acronym to sell his clients on the financial charms of the formerly toxic Brazil/Russia/India/China bloc. These countries, insisted Jim O'Neill, would by 2042 outrank the six biggest Western economies, and thus define the global future. O'Neill is an enormous, galumphing Mancunian, and no one who mattered at the time who wasn't Lloyd Blankfein believed him. (O'Neill is, after all, a Manchester United fan).

But in faraway capitals, in which policymakers and presidents were becoming fat on ecstatic growth rates and a commodities boom driven by the Chinese reinventing the term "commodities boom", it all made sense. Before long--or, more precisely, in September 2006--the foreign ministers of the four rising giants met in New York City to hash out something of a plan. The...

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