Russia’s upper house of parliament has formally ratified an agreement to set up a $100 billion foreign currency reserve for the BRICS (Brazil, Russia, India, China, South Africa) group of new economic powers.
The reserve is intended to protect the national currencies of the BRICS countries against global economic fluctuations and help support the nations’ balance of payments.
“In perspective, the cooperation of the BRICS member states in reforming the international monetary and financial system will remain a priority which is aimed at creating a stable and predictable system of international currencies”, said parliamentary spokesman Sergey Ivanov.
China will contribute $41 billion to the pool, Russia, Brazil and India $18 billion each, while South Africa’s investment will be $5 billion.
The fund is expected to be maintained by a managing council, a permanent committee and a coordinator who will be from the country of the current president.
BRICS members signed an agreement in Brazil in July to forge ahead with the $100 billion New Development Bank (NDB), as well as a currency pool.