BRIC nations to have bigger, louder voice

Group of 20 nations (G-20) finance ministers and central bank governors on last Saturday, September 5th, made a declaration to reaffirm their commitment to strengthen the financial system to prevent the build-up of excessive risk and possible future crises and support sustainable growth.

The G-20 finance ministers and central bank governors met in London last weekend ahead of the Pittsburg Summit to discuss how to revive the world economy. The meeting has come to a close in Horsham, southern England.

In addition, the finance ministers called for stronger regulation and oversight for systematically important firms, as well as rapid progress in developing stronger prudential regulation and consistent, coordinated implementation of international standards.

In response to demands set forth by the BRIC nations, namely, Brazil, Russia, India and China, the G-20 communique said it will complete the World Bank reforms by Spring 2010 and the next IMF quota review by January 2011. "Developing economies, including the poorest, must have a greater voice and representation," the G-20 communique acknowledged. For the World Bank's governance reform, it is to be completed by Spring 2010.

Finance ministers and central bank governors of BRIC nations met in London on September 4 to discuss world economy and called for the reform of international financial institutions. For the governance reform on the World Bank, the BRIC nations believed that the World Bank Group also require a review of its capital base in order to be able to fulfill an effective counter-cyclical role; they demand for a seven percent shift in IMF and a six percent shift in the World Bank. Besides, BRIC nations also appealed to G-20 countries not to give up or remove a package of policy measures they had adopted or introduced in coping with the global financial crisis.

BRIC nations have used one single voice to air their views or opinions, and this is of great importance in itself and will facilitate beefing up the integral voice and impact of the new emerging markets and developing countries and spurring the development of multilateralism.

At the G-20 economic summit held in London, capital of Britain in early April, BRIC nations came onto the world stage as "a new political bloc" for the first time when their foreign ministers signed a joint statement. "We are committed to advance the reform of international financial institutions… and we pledge to work together on issues pertaining to energy, food security, education and science," according to the BRIC statement.

The first-ever summit of the BRIC heads of state held in the beautiful Ural city of Yekaterinburg, Russia on June 16 this year had arrested global attention, and the BRIC came to the limelight for the first time on the world arena as an entity.

In view of its birth and growth, the BRIC is absolutely not a Commonwealth body as its member nations do not involve themselves in military cooperation or geopolitics. Since they seek to attain their respective rights and interests and set up global multilateral systems through negotiations, this event of vital significance undoubtedly conforms to a general current of the times in human history.

Of course, BRIC nations have numerous difficulties and obstacles to a varying extent in their development orientation, some differences or disparities in term of ideology, social system, geopolitics and economic interests, and also a number of few practical contradictions or disputes. But all this does not at all affect or interfere with their "equal partnership" and "cooperative win-win outcome".

However, BRIC members still share a strong desire to play a bigger role in creating a new global financial order and counter-balancing the West and Japan and to "have a greater voice and representation in global financial institutions."

Owing to their decisive, pivotal economical scale, BRIC nations have enhanced their competitive stature in the global economy and now been able to vie with Western developed countries, but none of these BRIC members can accomplish this objective alone.

BRIC should jointly press ahead with and help to set up a more rational new global order through much tougher and more arduous work. In the imminent G-20 Pittsburg Summit, the most pressing issue placed before BRIC nations is to work in cooperation and firmly oppose and cope with trade protectionism.

For a long-term point of view, whether the four BRIC nations have the motive, capacity and resolve to transform the global power structure and continue to represent the interests of developing countries with a single voice will focus to determine the future global order. It is precisely for this reason that BRIC nations should systematize and normalize the meetings of their leaders and ministers on a regular basis, whereas their representatives should improve their representation and more new emerging nations with great regional influences, especially South Africa, Mexico and Saudi Arabia, should be recruited. Only in this way, can newly emerging nations expand their ranks continuously and truly conduct fair dialogues with developed countries, equal in ranks or status.

By People's Daily Online and contributed by Prof. Shi Jianxun, an especially PD invited guest commentator，an economist and finance professor with prestigious Shanghai-based Tongji University