Durban: Deciding to establish a new Development Bank for financing infrastructure needs in emerging economies, the BRICS summit today called for reform of the international financial institutions to make them more representative and to reflect the growing weight of the five-member grouping and other developing countries.
"We remain concerned with the slow pace of the reform of the International Monetary Fund (IMF). We need to implement, as agreed, the 2010 IMF Governance and Quota Reform.
"We urge all members to take all necessary steps to achieve an agreement on the quota formula and complete the next general quota review by January, 2014," the 'eThekwini' (Durban) Declaration said at the end the Summit of leaders of the five countries including Prime Minister Manmohan Singh.
In the 13-page Declaration, the leaders said the reform of the IMF should strengthen the voice and representation of the poorest members of the IMF, including sub-Saharan Africa.
"All options should be explored, with an open mind, to achieve this. We support the reform and improvement of the international monetary system, with a broad-based international currency system providing stability and certainty, the declaration said.
Giving reasons for their decision to launch a BRICS development bank, the leaders noted that developing countries face challenges of infrastructure development due to insufficient long-term financing and foreign direct investment, especially investment in capital stock, which constrains global aggregate demand.
Noting that the New Delhi Summit last year had directed the finance ministers to examine the feasibility and viability of setting up a new development bank for mobilising resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries, the leaders said it would supplement the existing efforts of multilateral and regional financial institutions for global growth.
"Following the report from our finance ministers, we are satisfied that the establishment of a New Development Bank is feasible and viable.
"We have agreed to establish the New Development Bank. The initial contribution to the Bank should be substantial and sufficient for the Bank to be effective in financing infrastructure," the Declaration said.
Besides Singh and the host President Jacob Zuma of South Africa, the other leaders who attended the summit were Chinese President Xi Jinping, Russian President Vladimir Putin and Brazilian President Dilma Rouseff.