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S Africa wants BRICS bank for Johannesburg

11 July 2014, 17:57

Cape Town - South Africa's financial capital, Johannesburg is still in the running to be headquarters of a new development bank planned by the BRICS group of major emerging nations, a minister said.

Trade and Industry Minister Rob Davies told a media briefing in Cape Town reports that a decision had already been made on the location of the bank were incorrect.

"There is no decision on the domicile of the bank," he said, rejecting suggestions that Shanghai had already won the right to host the institution.

"It has been agreed by the heads of state that that will be a decision made by them," he said.

The leaders of BRICS countries, Brazil, Russia, India, China and South Africa, are due to hold a summit in Brazil next week where they are expected to sign a deal to create the bank.

"South Africa has indicated our desire to offer Johannesburg as a host domicile for the bank," Davies said.

The bank's financing of infrastructure development would not be limited to BRICS nations so a location in South Africa would give it "a huge advantage" in facilitating projects in other African countries, he said.

But the Kremlin said Thursday that the group has already decided on Shanghai as the headquarter for the bank.

The institution will be called "New Development Bank", with each BRICS member contributing $2 billion to its capital, Russian Finance Minister Anton Siluanov also said earlier this week.

The bank would have a maximum capital of $100 billion, reports from Moscow said.

The BRICS nations unveiled in 2013 their plans to create the bank, which aims to rival Western-dominated institutions like the World Bank.

"During the summit, we should decide on the creation of the bank and a currency fund," said Siluanov.

He added that member states would have to make their contributions to the bank's capital within seven years but that the bank should effectively be created by 2016.

Membership in the bank, which would specialise in financing infrastructure works, would be open to other UN states but the five BRICS nations would hold a controlling share of above 55 percent.

Siluanov said the BRICS would also sign a framework deal for a fund during the summit.

The fund dubbed a "mini-IMF" would amount to $100 billion, with $41 billion from China, $18 billion each from India, Brazil and Russia and five billion from South Africa.



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