Has a Window Closed and the BRICS Bounced off?

Never gloat.  Triumphantlism never ends well.

I have to wonder though.  What-if China's growth is really only 6%?

Could we see China growing at 3% in 2019?

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Russia may Propose Space Station to BRICS Countries

Moscow could propose to China and India to create a joint manned orbital station at the summit of the BRICS emerging economies in Russia’s Ufa in July, a document drafted by the expert council at Russia’s military and industrial commission said on Tuesday.

The experts recommend “working out the possibilities of an international manned project with BRICS countries as part of a common strategy of creating technological alliances.”

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US Disengagement has Consequences

American disengagement in the world is not consequence free. The new BRICS bank announced in Fortaleza by Brazil, Russia, India, China, and South Africa is largely a political exercise, which has been given a big boost by American indecision on IMF quota reform. U.S. detachment and inaction have given the BRICS the political cover to start something that would likely die with a whimper if Congress could muster the political will to pass IMF quota reform. The United States suffers from a lack of presidential leadership in the Bretton Woods arena; as we withdraw others fill the vacuum, and we cannot choose our replacements. American leadership always starts at the Presidential level, but Republicans share blame for the rise of the BRICS bank based on their inability to get IMF quota reform done in Congress.

The BRICS have complained about "vote" and "voice" in the Bretton Woods institutions. If we address the ostensible political grievances of countries like China and others at the IMF by passing quota reform their arguments for a BRICS bank largely collapse.

As long as the United States maintains implicit veto and influence over the selection the Bretton Woods institutions' leaders, we should accept marginal adjustments in shareholdings -- this has already happened at the World Bank, and the rest of the G20 has signed off on reform at the IMF. The IMF Quota reform is a good arrangement for the United States until a time when we can trade the U.S. held presidency at the World Bank for the managing director role at the IMF with the Europeans.

The international system still operates under the same essential structures and assumptions that were laid out in "the world America made" at the Bretton Woods Conference and elsewhere following WWII, and that international system works best under vigorous U.S. leadership. The BRICS bank is one of a growing number of efforts to "defect" (I think we should bring that verb back in its Cold War form) from an American led system, which serves both U.S. and world interests.

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BRICS IMF is Called New Development Bank and Based in Shanghai

FOR years the BRICS countries have insisted they are more than an acronym. To dispel any lingering doubts, the leaders of Brazil, Russia, India, China and South Africa, who gathered in the Brazilian city of Fortaleza for their sixth annual summit on July 15th, announced the creation of two financial institutions: the New Development Bank (NDB) to finance infrastructure and “sustainable development” projects, with $50 billion in capital to start with, and the $100 billion Contingent Reserve Arrangement (CRA), to tide over members in financial difficulties.

On the surface, the NDB and the CRA, which must still be approved by the five countries’ parliaments, look like upstart rivals to the World Bank and the IMF, together the cornerstone of the post-war economic order. The BRICS complain that the Bretton Woods outfits, named after a New Hampshire town where they were conceived 70 years ago this month, give the developing world short shrift. China, whose economy is second only to America’s, has fewer votes there than the Benelux countries. America and Europe have proved shamefully slow to redress the imbalance.

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Brazil, Russian, India, China & South Africa Call for Their own IMF

Leaders of the BRICS group of emerging powers huddled Tuesday in Brazil to launch a new development bank and a reserve fund seen as counterweights to Western-led financial institutions.

Brazilian President Dilma Rousseff welcomed the leaders of Russia, India, China and South Africa in Fortaleza on Tuesday before expanded talks with South American leaders the next day in Brasilia.

Rousseff told reporters before the summit that the bank would help the nations invest in infrastructure projects.

She said the $100 billion contingency fund would be a "safety net" to contain "volatility faced by various economies when the United States exits its expansionary monetary policy."

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