BRICS Summit Call for Alternative to IMF

Date: October 10
Location: Moscow

Russia, as the chair of BRICS this year, urged its partners to establish an alternative to the International Monetary Fund (IMF) in response to Western political pressure ahead of the upcoming BRICS summit.

Background

BRICS originally included Brazil, Russia, India, and China, but has expanded to also comprise South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates. Financial officials from these countries are convening in Moscow this week.

Statements from Russia

Russian Finance Minister Anton Siluanov indicated that the global financial system is dominated by Western countries, asserting that BRICS, representing 37% of the global economy, needs to develop a new alternative.

> "The IMF and the World Bank are not performing their roles. They are not working in the interests of BRICS countries," Siluanov stated at the meeting's opening.

He proposed the formation of new institutions that resemble the Bretton Woods framework tailored to BRICS needs.

Challenges Faced by Russia

Following the invasion of Ukraine in February 2022, Russia's forex reserves were frozen and its financial sector severely impacted by Western sanctions, cutting it off from international capital markets. There have also been reported delays in transactions with BRICS partners due to apprehensions over potential repercussions from Western regulators.

Progress on Financial Institutions

Nearly stalled progress has been noted for a proposed BRICS Bridge payments system intended to connect the financial systems of member nations. The only successful financial entity thus far is the New Development Bank, established in 2015 to finance infrastructure and sustainable development initiatives across BRICS nations and other emerging economies.