When President Luiz Inácio Lula da Silva arrives in Shanghai, on the final leg of his trip to China, he will be received by an old acquaintance. At that point, former President Dilma Rousseff will be in charge of the New Development Bank (NDB), the official name of the BRICS Bank, a bloc formed by Brazil, Russia, India, China and South Africa. With US$32 billion in projects approved since 2015, the bank currently invests US$4 billion in Brazil, mainly in highways and ports. Scheduled to take place between March 29 and 31, the meeting with Lula in Shanghai, where the NDB is headquartered, should be marked by the official inauguration of Dilma at the bank that she herself helped to found, in 2014. According to specialists interviewed by Agência Brasil , the institution’s new commander has the opportunity to expand the bank’s international insertion, but will have two major challenges: boosting projects related to the environment and circumventing the geopolitical impact of western retaliations against Russia, one of the founding partners. Regarding the green economy, Dilma’s main challenge, who faced conflicts with the government’s environmental area in both Lula’s terms, will not be adapting to the new environmental requirements of infrastructure projects. At the 27th United Nations Climate Conference (COP-27), in Egypt, the NDB made a commitment to increase financing for environmentally sustainable projects, but the success of this mission depends on the willingness of China and Russia to inject money into this type of enterprise. “At this point, it will depend more on who puts the money and finances the projects, mainly Russia and China, which do not have this environmentalist profile, deciding to put values in more environmental projects. Dilma’s adaptation to the green economy profile is the least of the problems”, says Carla Beni, economist and professor of MBAs at Fundação Getulio Vargas (FGV) in São Paulo. She, however, recalls that China can use the bank to soften the image of a large emitter of carbon and finance these projects. Articulação A doctor in international relations at the University of Lisbon and a member of the Portuguese Political Science Association, economist Igor Lucena agrees. For him, the articulation between the member countries of the Banco do Brics will be important for the partners to present green sustainability projects in the medium and long term. “We know that these projects are not simple, they take time to become successful, like the green hydrogen in Ceará, but they are important projects and that may be for President Dilma a legacy and a mark of her management within the bank. So, this will have to be done in partnership with the member countries and, perhaps, make it a requirement for new countries that want to join the bank, the possibility and the need to invest capital within this green project, ”he suggests. Russia Another challenge that Dilma will have to face at the helm of the NDB will be the resistance of western countries towards Russia. According to Lucena, sanctions due to the war in Ukraine are preventing the bank from issuing bonds in the European and North American financial markets. The institution’s new president will have to find options for raising funds outside the Brics. “There will be a greater need for President Dilma to articulate with countries not linked to the sanctions against Russia so that the bank can issue bonds, debt in states and regions that are capable of absorbing these papers and providing financing capillarity to the bank. Perhaps this is former president Dilma’s biggest challenge within the Brics: Russia’s international situation and how it impacts within the bank itself”, says Lucena. Carla Beni recognizes the difficulties brought about by the war in Ukraine and the rise in international interest rates, but says that Dilma has one element in her favor: the restoration of Brazil’s image abroad after Lula’s inauguration. “Dilma’s management can improve the image and relevance of the bank and this strengthens the position, because the government has announced and is making it very clear that it wants to strengthen Brazil’s alliance with the world. President Lula opened the government by saying that Brazil has returned to the negotiating table,” she explains. Experience Another important element pointed out by the two specialists is in the CV of the new commander of the NDB. The presidents of Russia, Vladimir Putin, and China, Xi Jinping, commanded the countries when Dilma was president of the Republic. This, according to them, gives Dilma political savvy. “A former president [de um país], whoever he is, is relevant because he has access to other heads of state. For the bank itself, Dilma’s nomination had a positive signal. It has a detail that people don’t pay much attention to. Dilma was one of the founders of Banco do Brics in 2014, so she has an internal representation in there and a very well-regarded transit from the bank’s perspective”, recalls Beni. “Dilma has two fundamental points that can mark her management. First, there is a much greater willingness on the part of China to move forward with the NDB, but also to bring new partners into the bank. In other words, the possibility of new resources entering the bank and this also leverages the capacity of Brazilian companies, which is a positive factor”, highlights Lucena. Change of power On the last 10th, the bank officially communicated that the current president, the Brazilian Marcos Troyjo, will leave the institution on March 24th. Special Secretary for Foreign Trade and International Relations of the former Ministry of Economy, Troyjo has held the presidency of the NDB since July 2020. According to the official statement, the succession was mutually agreed with the current government and obeys the governance and procedures of the institution. Dilma will preside over the bank until July 2025, when the rotating mandate between the founding countries of the financial institution ends. After President Lula took office, the government articulated the change of power, consulting all partners. Next Friday (24th), the same day that Troyjo leaves office, Dilma will be formally elected to assume the post in Shanghai, but an official inauguration ceremony is scheduled during Lula’s trip to China. In the communiqué issued on the 10th, the NDB listed achievements in Troyjo’s management, such as the expansion of the credit portfolio to US$ 32 billion that finance almost 100 projects and the improvement of the bank’s rating by the risk agencies, with an AA+ rating for long-term operations. This rating is higher than the top four US banks.
Agência Brasil
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