Is the Brics new Development Bank a Fledgling Alternative to the World Bank?

AuthorA. Vazquez
PositionUniversity of Buenos Aires (Buenos Aires, Argentina)
Pages6-34
BRICS LAW JOURNAL Volume IV (2017) Issue 3
ARTICLES
IS THE BRICS nEw DEVELoPMEnT BanK a FLEDGLInG aLTERnaTIVE
To THE woRLD BanK?
AGUSTINA VAZQUEZ,
University of Buenos Aires (Buenos Aires, Argentina)
DOI: 10.21684/2412-2343-2017-4-3-6-34
In 2001, the world began talking about BRIC – Brazil, Russia, India and China – as
a potential powerhouse in the world economy. After the 2008 international nancial
crisis, BRIC gained prominent momentum and the world saw them as a serious actor to
be watched. Today, BRICS (South Africa became a member of the bloc in 2010) are being
closely watched because there is no certainty as to their future.
The Shanghai-based New Development Bank was launched in this context and in
answer to the institutional crisis that the world observed with concern when US-guided
international economic institutions could not lead the way out of the 2008 crisis and
into recovery.
While each country around the globe lives its own domestic reality, the Trump
phenomenon in the United States has erupted on the international stage and is proving
to lead the still largest economy in the world onto the opposite path of the one set by the
United Nations in its 2030 Agenda for Sustainable Development.
These events as well as the roles played by the UN and the G20 are the subject of this article.
They are analyzed in order to provide a framework from which to answer the following
questions: Is the Shanghai-based New Development Bank a edgling alternative to the
World Bank, and are the BRICS a possible alternative to a more cooperative future?
Keywords: sustainable development; New Development Bank; World Bank; IMF.
Recommended citation: Agustina Vazquez, Is the BRICS New Development Bank
a Fledgling Alternative to the World Bank?, 4(3) BRICS Law Journal 6–34 (2017).
AGUSTINA VAZQUEZ 7
Table of Contents
Introduction
1. New Development Bank, Old Scope
2. When the Financial Architecture Started to Crumble
3. The UN Role
4. G20 Attitude towards Development: Ignoring a New Reality?
4.1. Regulatory Topics of the G20 Summits
4.2. Winners and Losers of the G20: How Do They Reect in the BRICS Countries?
Conclusion
Introduction
In 2001, the world began talking about BRIC – Brazil, Russia, India and China – as
a potential powerhouse in the world economy. Today, BRICS (South Africa became
a member of the bloc in 2010) and their activities are one of the most discussed
issues in global economics and international politics.
The global nancial meltdown witnessed in 2008 prompted calls for a second
Bretton Woods-type conference to overhaul the international nancial architecture
and create a robust international nancial regulatory mechanism.
At that time, there were very large unmet needs in the emerging and developing
countries, most clearly in the elds of infrastructure and more environmentally
sustainable forms of development. Moreover, there was the disappointment of
promises left unfullled with regard to the Millennium Development Goals, with the
identied decit in investment reaching around US$1 trillion annually.
That was the context in which the G20 convened in Washington D.C. in November
2008 to assess the impact of the global economic crisis and consider international
measures in response. Th e future of the wor ld was in j eopardy a s the general
crisis and such a major decit in investment would constrain the future growth of
emerging and developing economies. In population terms, this implied that a large
proportion of the world’s population would continue not to have access to electricity
and clean water.1
A communiqué issued by the G20 after the meeting called for both immediate
and long-term actions to stabilize the global nancial system, stimulate domestic
demand, help emerging and developing economies battered by the crisis and
strengthen the regulatory framework.
1 As pointed out in WWAP (United Nations World Water Assessment Programme). 2015. The United
Nations World Water Development Report 2015: Water for a Sustainable World. Paris, UNESCO (Aug.
10, 2017), available at http://unesdoc.unesco.org/images/0023/002318/231823E.pdf.

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT