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BRICS launches development bank, based in Shanghai

The BRICS group of emerging powers launched a US$50 billion development bank on Tuesday to be based in Shanghai and a US$100 billion crisis contingency fund, according to a joint declaration.

FORTALEZA, Brazil: The BRICS group of emerging powers launched a US$50 billion development bank on Tuesday to be based in Shanghai and a US$100 billion crisis contingency fund, according to a joint declaration.

The New Development Bank's first president will be from India while the board's chairman will be Brazilian, according to the declaration released at a summit in Fortaleza, Brazil.

The bank will have an initial subscribed capital of US$50 billion followed by an authorised capital of US$100 billion, equally shared among Brazil, Russia, China, India and South Africa.

The Contingency Reserve Arrangement will have an initial size of US$100 billion and will help countries avoid "short-term liquidity pressures, promote further BRICS cooperation, strengthen the global financial safety net and complement existing international arrangements."

The bank and fund are seen as counterweights to the Western-dominated World Bank and International Monetary Fund, which BRICS nations say need more reform to give emerging nations more voting rights.

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