NDB’s Strategic Shift: Local Currency Lending and Global Financial Transformation
According to the bank’s Chair, Dilma Rousseff, the New Development Bank (NDB), established by the BRICS coalition, focuses on reshaping the global financial landscape and striving for a multipolar system.
The NDB aims to amplify its lending in local currencies, specifically those of member states, like the South African rand and Brazilian real, to reduce dependence on the U.S. dollar. Rousseff articulated that lending about 30 percent of their offerings in local currencies is the goal for this year, amounting to $8 billion to $10 billion. This approach mitigates exchange rate risks and U.S. interest rate fluctuations, facilitating a transition toward a more multipolar financial system.
The NDB, founded in 2015 by BRICS nations, has lent $33 billion for sustainable development projects and is considering new members to diversify its global representation. Despite its divergence from traditional financial institutions, the NDB had to suspend operations in Russia due to sanctions. Rousseff highlighted the NDB’s commitment to respecting each member’s policies without imposing conditions on loans, distinguishing it from entities like the IMF and the World Bank.
Clever Robot News Desk 25th August 2023