IMF needs to adapt to new realities- Brazil
March 23, 2013, 9:16 am

The Brazilian minister says the IMF needs to give developing countries more power within the institution [Xinhua]

Fernando Pimentel, Brazil’s minister of development, industry and foreign trade, said on Thursday that among the major issues to be in the focus at the BRICS Summit would be the possible establishment of a BRICS development bank and a joint foreign reserve fund.

Pimentel also urged the International Monetary Fund (IMF) to modernise its governance structure, saying that “developing countries should have a more important role in the organisation’s governance system.”

“Developing countries as a whole, and on that the Brics are, of course, countries of highlight, should have a more permanent role on the IMF’s governance,” the Brazilian minister said

Brazil hopes for positive outcomes at the upcoming BRICS summit as the five-nation bloc is expected to reach a variety of agreements to promote multilateral cooperation and strategic partnership, noted Pimentel.

“Brics is an economic and a diplomatic bloc which has consolidated more and more at each summit it has had and each year that it has lasted, and we believe that it is now a permanent economic bloc in the international arena,” the minister said.

The BRICS countries are set to sign a number of bilateral agreements on the sidelines of the forthcoming 5th BRICS Summit in Durban next week.

Brazil also hopes to ink a bilateral agreement with China to promote trade in its national currencies, the minister asserted saying, it “would allow “an exchange mechanism in local currency involving up to $30 billion” or nearly half of total bilateral trade.”

The initiative was tentatively agreed last June with the signing of a memorandum of understanding after a meeting between Brazilian President Dilma Rousseff and then Chinese prime minister Wen Jiabao during the UN summit on sustainable development in Rio.

The Brazilian minister also noted that the BRICS Bank would help developing economies during global crises.

“The goal of the proposed bank is not meant as a sign of abandonment of any existing global financial institutions, but a response to current economic necessities,” Pimentel once noted at the summit.

According to Pimentel, trade volumes between the South American country and other BRICS members almost doubled to $95 billion in 2012, from $48 billion four years ago.

With inputs from Agencies