Brics nations discuss development bank

Jacob Zuma: "We have decided to enter formal negotiations to establish a development bank"

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Leaders of the so-called Brics nations - Brazil, Russia, India, China and South Africa - meeting in Durban have discussed the formation of a new development bank.

The bank would fund infrastructure and development projects throughout the developing nations.

Further talks would be needed to decide where the bank is based and how much capital it will have, the group said.

It would be the first formal institution of the Brics group.

Some commentators see the bank as a potential rival to the World Bank.

Following initial discussions on Wednesday morning, South African President Jacob Zuma said: "We are satisfied that the establishment of a new development bank is feasible.

"We have decided to enter formal negotiations to establish a Brics-led new development bank."

He said the bank would help the Brics economies to co-operate with "other emerging markets and developing countries in the future".

Growth potential

Speaking in Durban before negotiations began in earnest, Russian President Vladimir Putin highlighted the economic success of the five nations.

"The common annual economic growth rate in 2012 constituted 4%, in contrast to the 0.7% of the [biggest] seven financial countries," he said.

"Russia calls for using the economic potential of Brics more effectively, with the backing of business for increasing the volumes of mutual trade, investment and broadening industrial and technological co-operation. Certainly, the creation of a Brics development bank [would support] this task."

He added that any bank would have to work "exclusively based on market principles and offer support to the business community of all of our countries".

Reports suggest the bank would have access to $50bn (£33bn) in capital.

Also speaking in Durban, Chinese President Xi Jinping played up the importance of closer ties between the developing nations.

"The potential of Brics development is infinite," he said.

The Brics nations represent more than 40% of the global population and 17% of world trade.

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