Does the World Bank Want a BRICS Bank? (Foreign Policy)
World Bank chief economist Kaushik Basu is featured in Foreign Policy on his recent speech at the Center for Global Development addressing plans for a BRIC-led development bank.
As a former senior advisor to the Indian finance ministry turned World Bank higher-up, Basu has a unique perspective on the idea. He argued that the notion of an emerging-market led development bank responds to pent-up demand for capital to fund large infrastructure projects in major emerging economies. Neither the private sector nor the World Bank, he acknowledged, is responding adequately to that need. "There's scope for more multilateral organizations to do lending," he said. "You have space." On a recent trip to South Africa, Basu reportedly said much the same.
But Basu also expressed the hope that the Washington-based lender could up its game on infrastructure lending and meet some of the need driving the BRICS project. "We should be so effective and good that the space for [a BRICS bank] is limited." The economist suggested that the momentum could well dissipate, leaving the countries to find a face-saving exit from a project some have touted as an alternative to the World Bank.