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    Brazil hopes that the parliaments of the countries with emerging economies will soon ratify an agreement reached in July in the Brazilian city of Fortaleza on the creation of the so-called New Development Bank, Brazilian Ambassador to Russia Antonio José Vallim Guerreiro said on Wednesday.

    Brazil Hopes BRICS Members to Ratify Bank Agreement Soon

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    The Brazilian Ambassador to Russia underscores that the New Development Bank agreement will come into force only when all BRICS countries ratify it.

    MOSCOW, January 28 (Sputnik) – Brazil hopes that emerging economy BRICS country parliaments will quickly ratify a July 2014 agreement to create the so-called New Development Bank, Brazilian Ambassador to Russia Antonio Jose Vallim Guerreiro said on Wednesday.

    "I hope [the Fortaleza agreement] would be ratified by all parliaments because it is important to make all financial implications operational," Guerreiro said in an exclusive interview with RIA Novosti.

    The ambassador reiterated that the agreement is not yet legally in force and the timeline for its approval by member-states' parliaments has not been determined.

    "The agreement that we reached in Fortaleza is that the headquarters of the Bank will be in Shanghai and that India will propose a person to be the first president of the New Development Bank. While other countries should submit their proposals for persons to be considered as vice-presidents," Guerreiro said.

    An expert contact group from the BRICS countries will meet in March to discuss the creation of an independent rating agency within the group, José Vallim Guerreiro added.

    “There was a proposal already presented in this contact group in order to have a BRICS rating agency. The issue will be discussed further in the meeting of the contact group which will take place in March,” he said.

    Standard & Poor's (S&P) ratings agency lowered Russia's sovereign ratings to "junk" status from BBB- to BB+ with negative outlook on Monday.

    A junk rating indicated that a country or a company is expected to default on its debt.

    “This is my personal view, I don’t see anything against the present rating agencies, they have a job to do and there is a demand for their services, no doubt of that. But maybe the BRICS countries could discuss some kind of a different approach. Discussions are ongoing and let’s see what will happen in the future,” Guerreiro said.

    On Tuesday, Kremlin spokesman Dmitry Peskov said that S&P's decision to downgrade Russia’s credit rating was politically motivated and did not reflect the true economic situation in Russia.

    In January, rating agency Fitch Ratings downgraded Russia’s credit rating from BBB to BBB-, citing oil price declines and the ruble's depreciation. Another rating agency, Moody’s, downgraded Russia’s government bond rating to Baa3 from Baa2, with a possibility of a further downgrade, citing the same reasons.

    In 2013, Chinese rating agency Dagong, Russia’s RusRating and US rating company Egan-Jones established the Universal Credit Rating Group (UCRG). Currently the parties have equal shares in the project, but new partners may join in the future. The first UCRG ratings are expected later this year and its goal is to become an alternative to the "Big Three" rating agencies, namely S&P, Moody’s and Fitch.

    BRICS is a group of emerging economies that include Brazil, Russia, India, China, and South Africa. The BRICS countries make up about one-third of the world's population and command economies of about $13.6 trillion in total.

    The BRICS development bank's Shanghai headquarters and Indian presidency was settled on July 16, 2014, in the northeast Brazilian city of Fortaleza. The bank's initial capital is expected to be $100 billion and its creation is expected to offset the influence of Western-dominated financial institutions.

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    Tags:
    Brazil, Universal Credit Rating Group, Egan-Jones Ratings, RusRatings, Dagong, Moody's, Fitch Ratings, S&P, New Development Bank, Dmitry Peskov, Antonio Jose Vallim Guerreiro, Fortaleza, India, South Africa, China, Russia
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