Leaders from the so-called BRICS group of emerging nations have failed to launch a much-anticipated new development bank to rival Western-dominated institutions like the World Bank.
After holding talks in the South African port city of Durban on Wednesday, leaders from Brazil, Russia, India, China and host South Africa agreed in principle to create a joint infrastructure lender but said further talks were necessary to finalise the plan.
“We are satisfied that the establishment of a new development bank is feasible,” said host President Jacob Zuma, in remarks that hint at little progress beyond an agreement reached in the Indian capital, New Delhi, a year ago.
“We have decided to enter formal negotiations to establish a BRICS-led new development bank,” he added.
Officially leaders had been expected to consider the bank’s establishment, but South Africa and others had hoped to formally launch a $50bn infrastructure fund at the two-day summit.
The mooted bank is seen as a way of gaining influence on the world stage, countering Europe’s dragging economic crisis and addressing the $4.5tn in infrastructure spending the BRICS are estimated to need over the next five years.
Instead of a $50bn fund BRICS leaders agreed only that the initial capital contribution would be “substantial and sufficient for the bank to be effective”.
Key sticking points included how projects would be distributed and where the bank would be based, diplomats said.
Al Jazeera’s Tania Page, reporting from Durban. said all of the BRICS members say they want to establish the development bank, but they have disagreements over fundamental details.
“First of all, China wants it in China, and President Zuma wants it in South Africa,” she said.
“Another problem would be dealing with exactly how much each country would invest in it and how much control each would have over it.”
Russian envoy to Africa Mikhail Margelov told AFP news agency his country had pushed for an incremental approach to establishing the bank.
“We believe in a step by step way of doing business,” he said, “we better talk about projects and then we talk about needed amounts of money.”
The next BRICS summit will be in Brazil in 2014, but the leaders will meet in Russia on the margins of the G20 in September.