Brasilia - Brazil's President Dilma Rousseff said Wednesday a decision by Brics emerging powers to create a development bank did not mean Brasilia was moving away from the IMF.
The move by Brazil, Russia, India, China and South Africa to create the bank along with a crisis reserve fund has been seen in some quarters as designed to rival Western-dominated financial institutions.
Rousseff stressed that following the Brics bank creation she would like to see some changes in IMF structures.
“We have not the least interest in distancing ourselves from the IMF. On the contrary, we wish to democratize it and make it as representative as possible,” she told reporters following talks with Indian Prime Minister Narendra Modi.
“The distribution of quotas at the IMF neither reflects the power nor the correlation of economic strengths” of countries operating within it, Rousseff complained.
Her comments came ahead of discussions in Brasilia between BRIC leaders and counterparts from Argentina, Chile, Colombia, Ecuador, Venezuela and other Latin American nations.
“Our relationship with the IMF has gone from one of debtor to creditor,” she said.
“During the (global economic) problems of the euro crisis we contributed a 'firewall' to ensure things did not worsen still further,” said Rousseff.
Rousseff added that the new bank would take a different stance from that of the IMF towards emerging nations.
She said the bank would look on loan requests “very generously” although they would not be granted without proper prior assessment and would always be properly evaluated.
The New Development Bank, which mirrors the Washington-based World Bank while the reserve is seen as a “mini-IMF,” will be created with initial capital of $50 billion though that could rise to $100 billion.
The funds will be provided in equal measure by each nation to avoid concerns that one country has more power than the other and provide an opportunity for developing nations to fund vital infrastructure projects.
A Contingent Reserve Arrangement will have $100 billion at its disposal to head off potential economic volatility linked to the United States exiting its stimulus policy. - Sapa-AFP