Brazil’s President Lula Advocates for BRICS Bank as a Viable Alternative

Brazil’s President, Luiz Inácio Lula da Silva, recently expressed his belief in the potential of the BRICS Bank as an alternative financial institution, highlighting its importance in fostering economic cooperation among its member nations. President Lula’s remarks came during a high-level meeting of BRICS leaders in Brasília, where they discussed strategies to strengthen the organization’s role in the global financial landscape.

During a meeting with African diplomats, President Lula da Silva of Brazil conveyed the government’s perspective on the development bank created by the BRICS bloc, highlighting its role as an alternative to conventional financial institutions. President Lula further committed to enhancing collaboration between the BRICS bank and its African counterpart.

Brazil calls for strengthening of BRICS new development bank as a key financing instrument

According to a statement by Brazilian President Luiz Inacio Lula da Silva, authorities in Brasilia regard the New Development Bank (NDB), established by the BRICS nations (Brazil, Russia, India, China, and South Africa), as a promising alternative to conventional financial institutions, as reported by the Tass news agency.

During a meeting with ambassadors from African countries, Lula emphasized the desire for the BRICS bank to fortify itself as an alternative financing instrument, stating, “We aim to strengthen the BRICS bank as a viable alternative for financing, and we will enhance our cooperation with the African Development Bank.”

In his statement on Thursday, he elaborated that existing international financial and banking institutions disregard the requirements of developing nations, rendering them unsuitable, particularly due to the overwhelming debt burdens that many of these countries are grappling with.

Establishment and Leadership of the NDB: A Key Milestone for BRICS Countries

The NDB, formerly known as the BRICS Development Bank, was established by the BRICS countries following an agreement signed in Fortaleza, Brazil, during the summer of 2014, when Dilma Rousseff served as the President of Brazil. In March 2023, she was elected as the president of the bank.

The development bank of the BRICS nations finances infrastructure and sustainable development projects within the member states of the bloc and in developing countries. In 2021, the NDB expanded the scope of its activities by including Bangladesh, Egypt, the United Arab Emirates, and Uruguay.

According to the report, the bank has approved nearly 100 projects amounting to approximately $33 billion since its inception. These projects span various sectors, including transportation, water supply, clean energy, digital and social infrastructure, as well as urban construction.

NDB’s Green Bond Issuance supports sustainable projects in participating nations

In April of this year, the bank, headquartered in Shanghai, disclosed its issuance of the inaugural “green” bonds valued at $1.25 billion in U.S. dollars. The funds raised from this placement will be allocated towards financing or refinancing eligible “green” projects within the participating nations.

The BRICS Bank’s growing prominence and Brazil’s steadfast support for its mission underline the potential for greater South-South cooperation in addressing global challenges. As President Lula concluded his remarks, he expressed his optimism about the future of the BRICS Bank and its ability to facilitate economic growth, reduce inequality, and promote shared prosperity among its member nations.

In conclusion, Brazil’s President Lula da Silva’s endorsement of the BRICS Bank as an alternative financial institution highlights the growing recognition of its potential to address the developmental needs of emerging economies. The NDB, established by the BRICS countries, has made significant strides in funding infrastructure and sustainable development projects.

With an expanding portfolio and partnerships with regional financial institutions, the bank is poised to play a transformative role in the global financial landscape. Moreover, its recent issuance of “green” bonds further demonstrates its commitment to supporting environmentally friendly initiatives. As the NDB continues to strengthen and collaborate with other institutions, it holds great promise for promoting inclusive and sustainable development among its member nations.

Also Read: Blur dominates NFT Lending Market, Capturing 82% of Loan settlements.