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New Development Bank's role in the global financial architecture

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  • Bert Hofman
  • P. S. Srinivas

Abstract

The New Development Bank (NDB) was established in 2015 by the grouping of Brazil, Russia, India, China, and South Africa (referred to as the BRICS). The establishment of the NDB was one of the outcomes of the economic and political dissatisfaction arising out of the growing disparity between the BRICS' development needs, their share of the world economy, and their representation in the established institutions of the global financial architecture. The paper examines the origins of NDB, the unique aspects of its governance structure, innovations in its operational model, and the challenges it currently faces. The paper concludes that 9 years after its establishment, NDB has completed the core foundational work required of a new multilateral development bank. It is undoubtedly an interesting experiment in the creation of a new international financial institution, and it has made a good and solid start. However, the current global environment is very different from the world of 9 years ago. If the NDB can navigate well the current challenges and if it can scale up significantly, then the NDB indeed has the potential to make a significant impact on the global architecture of development finance. Whether it does so, remains to be seen.

Suggested Citation

  • Bert Hofman & P. S. Srinivas, 2024. "New Development Bank's role in the global financial architecture," Global Policy, London School of Economics and Political Science, vol. 15(2), pages 451-457, May.
    • Handle: RePEc:bla:glopol:v:15:y:2024:i:2:p:451-457
    DOI: 10.1111/1758-5899.13389
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    References listed on IDEAS

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    1. Hongying Wang, 2019. "The New Development Bank and the Asian Infrastructure Investment Bank: China's Ambiguous Approach to Global Financial Governance," Development and Change, International Institute of Social Studies, vol. 50(1), pages 221-244, January.
    2. Andrew F. Cooper, 2017. "The BRICS’ New Development Bank: Shifting from Material Leverage to Innovative Capacity," Global Policy, London School of Economics and Political Science, vol. 8(3), pages 275-284, September.
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