BRICS bank may open by year end

Membership in lender will not be limited to the five nations

The BRICS Development Bank will be operational as early as the end of this year or the beginning of 2016, and membership will not be limited to the group's five-member nations, Vice-Finance Minister Shi Yaobin said on Friday.

Shi said the institution will be open for all United Nations members, with inclusion agreed by its board of governors. He also disclosed preparation work for the new multilateral lender is well underway, including the creation of its articles of association to be approved by each nation's legislature, the establishment of the multilateral secretariat, and the formulation of its mandate and some specific policies.

The details were revealed in a statement on the Ministry of Finance's website. It also said the first meeting of the bank's board of governors will be in early July during the BRICS summit in Russia, at which it will formally appoint its president and vice-presidents.

It is still less than a year since top leaders from Brazil, Russia, India, China and South Africa announced the setting up of the bank, formally known as New Development Bank.

K.V Kamath, who headed India's leading private bank ICICI Bank for more than a decade, has already been named as the first president of the $100 billion bank. Zhu Xian, vice-president of the World Bank, has been picked by China as one of the four vice-presidents.

The bank's headoffice, meanwhile, has been earmarked for Lujiazui, Shanghai's financial hub, while an African regional center will be set up in Johannesburg, South Africa.

The announcement means officials will now have to move fast to establish the bank's position in relation to several other more established and emerging multilateral financial organizations, and the pressure will be on to get it operational as soon as possible.

Another priority will be to underline how the bank differs from the Asian Infrastructure Investment Bank, which has made a huge initial impact since it was first proposed by the Chinese government at the end of last year, attracting the likely membership of 57 countries from Asia, Europe, Africa, Latin America and Oceania.

Shi's statement insisted the BRICS bank will be complementary with the other established development finance organizations such as the World Bank and Asian Development Bank, and the enlarged group will learn from, and cooperate with each other, contributing to connectivity within Asia and the rest of the world.

Huang Wei, a researcher at the Institute of World Economics and Politics under the Chinese Academy of Social Sciences, said there was already a clear difference between AIIB and the BRICS bank.