While taking part in an international congress in Rio de Janeiro, IMF’s Executive Director for Brazil Paulo Nogueira Batista Jr. Said that setting up BRICS’s Development Bank and its reserve fund is the challenge currently faced by the bloc made up of Brazil, Russia, India, China and South Africa.

Batista pointed out that the new institutions, created in the group’s previous meeting, last month in Brazil, will strengthen the bloc less economically than in its global governance sphere. “Now there’s the hard work, the less charming work—that of making the institutions work,” he explained, underscoring that this is crucial for the future of BRICS.

The economist made it clear that these initiatives do not imply a break with the IMF, the World Bank (IBRD), or other international agencies. “None of the BRICS countries want to break with the IBRD or the IMF, but they do not find enough understanding from countries like the United States over the changes taking place in the world,” he remarked.

BRICS’s Development Bank is to be based in Shanghai, and its first chair to be occupied by a representative from India. The bank’s authorized start-up capital is $100 billion, and the subscribed capital will total $50 billion, to be equally paid in by each member country. The resources aim to finance infrastructure projects in developing countries.

The bloc’s reserve fund, in turn, which amounts to $100 billion, will help BRICS countries themselves in case of payment difficulties.