The BRICS declaration at the Ufa summit has warned that the global economy is going through a difficult and instability phase.
It also gives more ideas about the newly launched New Development Bank (NDB). As per the declaration, the NDB will closely associate with another Brettonwoods alternative set up- the AIIB.
Global economy is in instability
The declaration signed by the five counties that hold nearly 40 percent of world’s population and one third of the world GDP has cautioned fragile recovery of global growth and the group is “concerned about potential spillover effects from the unconventional monetary policies of the advanced economies”.
The US Fed is going to make a critical decision about its easy money policy in the coming weeks.
NBD will associate with AIIB
About the NDB that the BRICS has launched at Ufa, the declaration hinted that it may provide loans outside the BRICS -“the NDB (New Development Bank” shall serve as a powerful instrument for financing infrastructure investment and sustainable development projects in the BRICS and other developing countries and emerging market economies”.
A notable decision at the declaration is the NDB will closely work with the AIIB that has a more multilateral structure. All BRICS countries are members of the AIIB as well.
“We welcome the proposal for the NDB to cooperate closely with existing and new financing mechanisms including the Asian Infrastructure Investment Bank,” said the document.
Support for Russia
The Ufa summit also witnessed members coming support for Russia on sanctions by the West. In a notable statement, Prime Minister Modi has criticized unilateral sanctions are hurting economic development.