Emerging economies look to play major roles in global governance

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Chinese President Xi Jinping said the BRICS group of emerging economies need to take a greater role in global governance. But what does that mean?

Laying the foundations for a new kind of finance, construction begins on the New Development Bank in Shanghai – a joint project by the five-nation bloc to fund billions of dollars of projects around the world.

For China, it’s the latest symbol of a changing global financial order with rules traditionally set by the West.

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“Our ever-closer ties with the rest of the world requires our five countries to play a bigger role in the global governance. Without our participation, many pressing global challenges can not be effectively dealt with,” President Xi said.

Economic governance includes rules designed to stop a repeat of the economic crash of 2008.

The bankruptcy of US investment bank Lehman Brothers set off a chain reaction that wiped out trillions of dollars.

Since that financial crisis, advanced countries have tried to regulate banks and stock markets to prevent another meltdown.

China admits it has taken a back seat in this effort, but now it wants to take the wheel.

And where China is stepping up, some say the US is stepping down, turning its back on global leadership with a more protectionist and inward looking agenda under President Donald Trump. Xi’s message is the complete opposite.

“We should push economic globalization characterized by openness, inclusiveness, balance and win-for-all. We should build an open world economy, support the multilateral trade system and stand against protectionism,” said Xi.

The BRICS member nations have increasingly the combined clout to do that. By the group’s estimates, they now account for nearly a third of the global economic output.