The location of the NDB Africa Regional Center in Johannesburg, South Africa has been well received by other African countries who felt that it would play a crucial role in enhancing infrastructure development in the continent.
Deputy Governor of the Central Bank of Uganda, Louis Kasekende says African countries want to have access to credit as quickly as possible at low rates and to further expand trade with the BRICS countries.
Speaking at the African Development Bank 50th Annual meeting, in May 2015 in Abidjan, Ivory Coast, Kasekende expressed hope that the NDB would facilitate that growth and provide development focused on the developing world.
“We are confident that the NDB will be able to play a major role in alleviating poverty, and, simultaneously, in improving infrastructure development globally. We are happy that it will also have a simplified procedure for project selection, including providing financial means on the basis of project and, or corporate-wide principles, in order to reduce the timeframe of projects finalisation and approval process. And it will extend financing and lending activities to least developed economies, in order to leverage the role of the bank as well as insure equitable distribution of savings and investments globally,” he said.
Papa Madiaw Ndiaye, founding Partner, and Chief Executive Officer at Advanced Finance & Investment Group LLC, who also spoke at the same event, welcomed the establishment of the NDB and called on South Africa to ensure the participation of African banks in the institution. Ndiaye, who was representing Senegal’s private sector, added that Africa was in dire need of concrete trade initiatives. The meeting further declared that the creation of the bank was a positive step for the continent and it would play a leading role in the development of infrastructure and enhance the circulation of people and goods and other services.
President Jacob Zuma, told a media briefing in Pretoria ahead of the 5th BRICS Summit, which was held in Durban, in March 2013 that the establishment of the NDB was a major outcome of engagement among the BRICS states. “The NDB will assist in mobilising resources for infrastructure and sustainable development projects in BRICS and other emerging economies,” he said.
The New Development Bank (NDB) is a development banking institution created by the BRICS member states as an alternative to the World Bank and the International Monetary Fund (IMF). According to the BRICS declaration, the bank is meant to boost infrastructure development in the five member states and other emerging economies. The bank is headquartered in Shanghai, China and the Africa regional center will be located in South Africa.
According to the BRICS agreement on the founding of the bank signed in Fortaleza, Brazil in July 2014, the NDB would reflect the close working relationship between the member countries while providing a powerful instrument for increasing their economic cooperation. It further states that the purpose of the bank shall be to mobilize resources for infrastructure and sustainable development projects in BRICS and other emerging market economies and development countries to complement the existing efforts of multilateral financial institutions for global growth and development.
“In order to fulfill its purpose, the bank shall support public or private projects through loans, guarantees, equity participation and other financial instruments. It shall also cooperate with other financial entities and provide technical assistance for projects to be supported by the bank”, states the agreement.