The fifth Brics summit has failed to live up to expectations, with the summit drawing to a close without agreement on the key details on the much awaited Brics Development Bank.
Brics leaders have agreed the bank must be established, but must still hold more talks to thrash out details.
No agreement has been reached on the bank’s location, size or funding model.
President Zuma said on Wednesday that during the Durban summit the five-member countries had decided to enter “formal negotiations” on the matter.
The bank is intended to co-fund infrastructure in developing regions. It was also seen as a move to reduce emerging countries’ reliance on Western institutions.
The Brics leaders said in a joint statement – read out by Zuma – that they were satisfied that the establishment of the bank had been found to be viable and feasible.
“The initial capital contribution to the bank should be substantial and sufficient for the bank to be effective in financing infrastructure,” the five countries said.
Apart from investigating the feasibility of the bank, the finance ministers and central bank governors from the five countries have been tasked to look into the feasibility of the establishing a financial safety net for the Brics countries.
Zuma said yesterday that the Brics countries had agreed that the establishment of a contingent reserve arrangement was desirable and feasible.
It was envisaged that the arrangement would be established with an initial $100 billion (R930bn).
The fund would help Brics countries forestall short-term liquidity pressures, provide mutual support and further strengthen financial stability.
Zuma said the leaders of the Brics countries would meet in Russia in September, on the sidelines of the G20 summit, to take stock of the progress made with regards to the establishing the bank and the contingent reserve arrangement.
Indian Prime Minister Manmohan Singh said he had no doubt Zuma’s leadership of Brics would increase intra partnerships while also increasing the forum’s global role.
He said the Brics countries needed to respond to the weaknesses in the global economy by strengthening trade and investment among themselves.
Brazilian President Dilma Rousseff said if the advanced economies were shrinking, the emerging economies should make every effort to expand their own economies by relying on their domestic markets.
Chinese president Xi Jinping said his country would support Africa’s efforts for stronger economic growth and urged other countries to do the same.