Illustration: Liu Rui/GT

The BRICS group has scored a big geopolitical win in its efforts to rebalance the global economic and political architecture, with the creation of the New Development Bank (NDB) in the sixth BRICS summit. The rest of the world is increasingly aware of the importance of this landmark deal and the ability of the BRICS to work together to achieve collective objectives.

Since the BRIC acronym was coined, pundits in the West have been skeptical about the future of this emerging bloc, claiming that the resurgence of those emerging powers is just a story and the demise of the BRICS is inevitable.

Some argue that the BRICS is merely an eye-catching "GDP" group without shared defining characteristics, and that its legitimacy relies on nothing but the fast economic growth rate. They believe when the global commodity boom comes to an end, the political weights of the BRICS powers will break up accordingly.

There are also some Western media and scholars intentionally sowing discord among BRICS members. For instance, Russian President Vladimir Putin was criticized of making use of the "anti-Western bloc" to defy a Western push to isolate Russia.

In some ways, it is true that the differences among the BRICS countries may be more striking than the similarities.

For instance, China is an investment-led economy with a powerful competitiveness in manufacturing. India's economy has a robust software industry and a large outsourcing sector, but is more closed and insular. The Brazilian economy is dominated by agricultural exporters, and Russia is overwhelmingly dependent on oil and gas. And compared with these four large states, South Africa is much smaller in economic size.

However, one should not underestimate the political aspirations shared by the five emerging economies. Regardless of the different economic developing models, they share one common ground; they are dissatisfied with the status quo and believe together they can strive for a better international order. In this sense, the BRICS is more like a political club than an economic one.

Few would doubt the geopolitical shift in the making, with the transfer of power from old economies to new economies, known as the "rise of the South."

When the world is entering into a multipolar stage in global arena, the old powers are still maintaining their dominance in global architecture, like the World Bank and the International Monetary Fund (IMF).

The voices of developing countries are underrepresented in the global economy. This injustice needs to be adjusted. In this context, it is natural and justifiable for the BRICS countries to be united in vision and practice, adopting concerted approaches to promote themselves as the voice of the global South to counter the North.

The launching of the NDB undoubtedly serves this purpose. If the existing international financial institutions had granted a greater stake to emerging powers, the creation of the NDB might not be necessary. However, after years of tortuous negotiations, the BRICS countries feel disappointed, as the promised reforms to these institutions have not been materialized.

Tired of waiting for their economic weight to be reflected in existing international financial institutions, the BRICS countries decided to set up their own.

The ideas of creating the NDB to upgrade the role of developing countries was first expressed in 2012, but the stumbling blocks were the distribution of capital shares and the location of headquarters.

The divergences, exaggerated by Western scholars, are not insurmountable. Inspired by the common political pursuits, the sixth BRICS summit marked a breakthrough on a number of thorny problems that stymied earlier meeting: The initial subscribed capital of $50 billion will be equally shared among five countries, the new bank's headquarters will be in Shanghai, its first president will be Indian, and the chair of its board of governors will be Russian.

In addition, a $100 billion crisis contingency fund has also been launched to help countries to avoid short-term liquidity pressures.

It is self-evident that the bank and the fund are regarded as counterweights to the Western-dominated World Bank and IMF.

According to the Brazilian news, the NDB will be open to accept new members from developing countries and multilateral financial institutions, but the BRICS voting power should not fall below 55 percent.

The NDB represents a major political move to rebalance the international financial system, encouraging the World Bank and the IMF to rethink its policies on international development financing. At the same time, the emerging markets have the opportunity to borrow more capital at cheaper rates and with fewer strings attached than the Washington-based financial facilities.

The author is a research fellow of the National Academy of Development and Strategy, Renmin University of China. opinion@globaltimes.com.cn