FORTALEZA Brazil (Reuters) - The group of five BRICS emerging market countries is considering starting a joint infrastructure fund with initial capital of around $10 billion, a source close to the discussions told Reuters on Tuesday.
The fund, which is under negotiation and could become operational at the next BRICS summit in Russia next year, would be initially financed by the sovereign funds of Brazil, India, China, Russia and South Africa.
It could later allow for the participation of other sovereign wealth funds from other countries, said the source who declined to be named because negotiations are ongoing.
The money would be invested in infrastructure projects within the BRICS countries, including the construction of roads, bridges and airports.
Leaders of the BRICS nations are holding on Tuesday their annual summit in Brazil, where they are expected to sign a deal creating a $100 billion development bank and a currency reserve pool worth the same amount.
The Russian Direct Investment Fund, a state-backed private equity fund worth $10 billion, is leading talks with its BRICS peers on the new initiative, it said earlier on Tuesday.
Kirill Dmitriev, RDIF’s chief executive officer, said the fund would help fill in the gap for long-term financing in BRICS countries. “It would be complementary to the BRICS’ new development bank by providing equity to those projects,” said Dmitriev on the sidelines of the summit.
The RDIF invests alongside foreign partners and has previously attracted money from the Middle East and Asia.
Additional reporting by Lidia Kelly in Moscow; Editing by Walter Brandimarte, Meredith Mazzilli and Paul Simao