Friday

3rd Feb 2023

Emerging nations crafting plan to come to Europe's aid

  • Brazil and the other Brics are fashioning a plan to aid Europe, the country's finance minister has said (Photo: guipimenta)

In a stunning reversal of fortune, it has emerged that the so-called Brics nations, the emerging economies of Brazil, Russia, India, China and South Africa - who almost alone in the global economy have weathered the financial crisis sitting atop huge international reserves - are planning to come to Europe's aid.

Brazilian finance minister Guido Mantega on Tuesday said that the Brics states are to hold a meeting on 22 September to discuss co-ordination of an EU rescue plan.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

"We will meet next week in Washington to decide how to help the European Union to get out of this situation," he said.

The nations are considering substantially boosting their holdings of euro-denominated bonds in their foreign exchange reserves.

According to Brazilian business daily Valor, the Brics nations are to unveil a plan that would go beyond Europe and look to aid a stabilisation of the wider global economy.

However, the paper also said that the plan would involve investment in only the stronger European economies, such as Germany and the UK. At the same time, the Financial Times has reported that Italy has taken its begging bowl to Beijing, with finance minister Giulio Tremonti meeting with the head of the China Investment Corporation, China’s major sovereign wealth fund, to discuss the possibility of the Middle Kingdom purchasing Italian bonds.

Brazil’s Mantega for his part did not give additional details of what was being considered. The Brics pow-wow is to take place a day before the wider G20 meeting and ahead of a gathering of the International Monetary fund from 23 to 25 September.

What have been regularly referred to as ‘emerging economies’ have seen their growth outstrip that of the main industrialised nations in recent years. China, the most successful of the group, maintains reserves worth some $3 trillion.

The EU has in multiple reports and plans of its own expressed how only through restructuring and austerity can the bloc hope to compete with China. As Brussels' austerity strategy wobbles in the face of faltering growth and soaring unemployment, Europe may have to submit to the ultimate indignity of a rescue from the former subjects of its colonialism.

China: 'You can't depend on us alone to rescue Greece'

A 'regular' phone call between EU commission chief Jose Manuel Barroso and Chinese Prime Minister Wen Jiabao on Friday morning was aimed at reassuring markets that China will continue to support the ailing eurozone. But a Chinese diplomat noted that Beijing will only buy those bonds guaranteed to be paid back.

Get used to Brazil as growing power, ambassador tells EU

Brazil's top diplomat to the EU has said his country was disappointed by Europe's reaction to the recently brokered nuclear agreement with Iran, indicating that the West must get used to his country's growing presence on the international stage.

South Africa summit sheds light on EU 'strategic partnerships'

A meeting between EU leaders and South African President Jacob Zuma has shed light on how the union aims to use "strategic partnerships" to shape world events, as well as the limits of its friendship with the young democracy.

Hawkish ECB rate-rise 'puts energy transition at risk'

The European Central Bank raised interest rates by another 0.5 percent to a 14-year high, and expects to hike rates by another half percent in March. But what does that mean for the green transition?

Opinion

More money, more problems in EU answer to US green subsidies

Industrial energy-intense sectors, outside Germany and France, will not move to the US. They will go bust, as they cannot compete in a fragmented single market. So to save industry in two member states, we will kill the rest?

Latest News

  1. Greece faces possible court over 'prison-like' EU-funded migration centres
  2. How the centre-right can take on hard-right and win big in 2024
  3. Top EU officials show Ukraine solidarity on risky trip
  4. MEPs launch anonymous drop-box for shady lobbying secrets
  5. Hawkish ECB rate-rise 'puts energy transition at risk'
  6. MEPs push for greater powers for workers' councils
  7. How Pavel won big as new Czech president — and why it matters
  8. French official to take on Islamophobia in EU

Stakeholders' Highlights

  1. Party of the European LeftJOB ALERT - Seeking a Communications Manager (FT) for our Brussels office!
  2. European Parliamentary Forum for Sexual & Reproductive Rights (EPF)Launch of the EPF Contraception Policy Atlas Europe 2023. 8th February. Register now.
  3. Europan Patent OfficeHydrogen patents for a clean energy future: A global trend analysis of innovation along hydrogen value chains
  4. Forum EuropeConnecting the World from the Skies calls for global cooperation in NTN rollout
  5. EFBWWCouncil issues disappointing position ignoring the threats posed by asbestos
  6. Nordic Council of MinistersLarge Nordic youth delegation at COP15 biodiversity summit in Montreal

Join EUobserver

Support quality EU news

Join us