Brazil, Russia, India and China, collectively known as the BRIC countries, are holding their first summit today in Yekaterinburg, Russia. Leaders from the countries are expected to discuss the cause, impact and solutions to the global economic crisis.
Jiang Shixue, deputy director-general of the Chinese Center for Third World Studies at the Chinese Academy of Social Sciences, told China.org.cn that leaders should make the call for reform of the international monetary system and seek a louder voice for developing countries facing the global financial crisis.
Reforms of the international monetary system and financial institutions top the agenda.
The four countries' GDPs, speed and mode of economic development are playing an increasingly prominent role in the international economy, said Feng Yujun, director of the Institute of Russian Studies at China Institutes of Contemporary International Relations. Their financial cooperation also will further promote the normalization of the world economy.
The governor of China's central bank, Zhou Xiaochuan, suggested in an article to consummate the international financial institutions by replacing the U.S. dollar with a super-sovereign reserve currency, an idea supported by many developing countries.
Zhou wrote that it was necessary to create a reserve currency "disconnected from individual nations and is…able to remain stable in the long run, thus removing the inherent deficiencies caused by using credit-based national currencies."
Jiang said replacing the U.S. dollar would be possible if the four nations can work together.
Jiang also said the four nations need to strengthen their administration over their economies, which will cushion the impact of the financial crisis. It also will enhance mutual currency swap and loan-for-oil programs.
Long-term goals of the BRIC countries include speeding up cooperation between developing countries and further promoting dialogue between the developed northern countries and developing southern nations; better protecting the interests of developing countries in the Doha Round; enhancing cooperation in resource development and climate change; and institutionalizing the BRIC countries in the political field.
Analysts say China may be the first country to recover from the financial crisis, after which its economic position in the world will be elevated.
China has played a positive role in stabilizing the world economy, said Sun Shihai, deputy director of the Institute of Asia-Pacific Studies at the Chinese Academy of Social Sciences. China's sustained and rapid economic growth has ensured a solid base of national strength and benefited the world by stimulating export from developing countries and attracting investment from developed countries.
China is taking a leading role among developing countries. China's voice is the voice of socialist countries, and China's development represents the direction of socialist development, Jiang said. China also has kept close relations with both developing and developed countries, promoting both South-South cooperation and North-South dialogue.
But China has no interest to use BRIC as a counterbalance against Western countries, Feng said. China's attitude toward BRIC is to enhance cooperation step-by-step between the four nations and let it represent the interests of developing countries and emerging economies. China's leaders also want BRIC to be a platform of cooperation and dialogue between the developing and developed countries.
The BRIC nations account for 42 percent of the world's population and enjoyed an average economic growth of 10.7 percent per year from 2006 to 2008.
The term BRIC was first coined and prominently used by Goldman Sachs in 2001. Goldman Sachs argued that, because the four countries are developing rapidly, their combined economies could eclipse the combined economies of the current richest countries of the world by 2050.
(China.org.cn by Li Shen June 16, 2009)
