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China pledges new funding for BRICS

International Business
Tue, 05 Sep 2017

XIAMEN: China will give $80 million in funding for BRICS co-operation plans, Chinese President Xi Jinping said yesterday, while the bloc of five emerging countries pledged to oppose protectionism.

Xi offered 500m yuan ($76.4m) for a BRICS economic and technology co-operation plan, and another $4m for projects at the group’s New Development Bank (NDB) during a three-day leaders summit in the southeastern city of Xiamen.

China’s new contributions to BRICS pale in comparison to its $124 billion pledge earlier in May for Xi’s own Belt and Road initiative, which aims to expand links between Asia, Africa, Europe and beyond as a new way to boost global development.

The announcement came amid questions over the relevance of BRICS and China’s commitment to the NDB in light of the Belt and Road initiative and the China-led Asian Infrastructure Investment Bank, both key efforts by Beijing to bolster its global influence.

Xi said during a plenary session at the BRICS leaders’ summit that the five emerging economies – Brazil, Russia, India, China and South Africa – should increase co-operation in sectors such as trade and investment, monetary policy and finance, and sustainable development.

“We should redouble our efforts to comprehensively deepen BRICS partnerships and open BRICS co-operation,” he said.

Set up in 20l5 as an alternative to the World Bank, the Shanghai-headquartered NDB was seen as the first major BRICS achievement after the group came together in 2009 to press for a bigger say in the post-Second World War financial order

created by Western powers.

The BRICS leaders will gather in Xiamen through today, giving host China its latest chance to position itself as a bulwark of globalisation in the face of U.S. President Donald Trump’s “America First” agenda.

A draft “Xiamen Declaration”, a formal version of which is expected to be issued later, said BRICS countries will continue to firmly oppose protectionism as they are committed to an “open and inclusive” multilateral trading system.

The communique emphasised the need to be vigilant in guarding against “inward-looking policies” that could hurt global market confidence, and called upon all countries to fully implement the Paris climate agreement.

The summit has been overshadowed by North Korea’s sixth and most powerful nuclear test, which came on Sunday just hours before Xi opened the meeting with a keynote speech, and prompted a vow of a “massive” military response from the US if it or its allies were threatened.

The BRICS grouping said in its draft communique that it strongly deplored Pyongyang’s test, but that the problem over its nuclear programme should only be settled through peaceful means and dialogue.

“We express deep concern over the ongoing tension and prolonged nuclear issue on the Korean peninsula,” it said.

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