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Brics bank in talks to admit Saudi Arabia as member

Reuters/Damir Sagolj
Saudi Arabia is a major beneficiary of the Belt and Road Initiative launched by Chinese president Xi Jinping

China-based New Development Bank, or Brics bank, is in talks to admit Saudi Arabia as its ninth member to strengthen its funding options.

The kingdom’s inclusion will reinforce ties between the bank, set up by the world’s biggest developing economies as an alternative to Bretton Woods institutions.

“In the Middle East, we attach great importance to Saudi Arabia and are currently engaged in a qualified dialogue with them,” the Financial Times reported, citing the bank statement.

The bank will hold its annual meeting on Tuesday and Wednesday.

The membership will bolster Riyadh’s bonds with the Brics countries as Saudi Arabia, the world’s largest crude oil exporter, seeks closer ties with Beijing.

Chinese President Xi Jinping hailed a “new era” in the countries’ ties when he visited the kingdom late last year.

The NDB was set up in 2015 by Brics countries — Brazil, Russia, India, China and South Africa — has lent $33 billion to more than 96 projects in the five founding member nations and has expanded its membership to include the UAE, Egypt and Bangladesh.

Russia, a founding member, holds about a 19 percent stake in the bank, the newspaper reported. However, the Ukraine war has raised concerns about the bank’s dependence on Moscow due to sanctions.

Fundraising options are “the most important thing at the moment”, said Ashwani Muthoo, director-general of the NDB’s independent evaluation office.

“We are struggling to mobilise resources,” he said.

The bank has raised funds in China’s renminbi and was seeking to raise South African rand this year.