BRICS’ Multilateral Bank Commits Over U.S. $1B to Rebuild Flood-Devastated Brazilian State

ON 05/15/2024 AT 08 : 49 AM

The geopolitical and economic alliance BRICS just voted to provide $1.15 billion in reconstruction aid to the Brazilian state of Rio Grande do Sul.
Aerial view of just part of the devastating flooding in the Brazilian state of Rio Grande do Sul in May 2024.
Aerial view of just part of the devastating flooding in the Brazilian state of Rio Grande do Sul in May 2024.. Glenn Greenwald, via X, from Brazilian government sources

The funding was announced yesterday by Dilma Rousseff, President of the New Development Bank, a multilateral bank created and administered by the BRICS group of nations.

Over the last weeks, catastrophic rains and flooding exploded across the state of Rio Grande do Sol. Driven by the one-two punch of the climate crisis and El Niño weather patterns, seemingly endless torrential downpours ended up destroying much of the infrastructure, housing, and other structures in the state. It also severely ravaged vast agricultural fields while also bringing most industrial production in the region to a standstill. Counts so far say the storms have killed 148 people, injured 806, and left 127 missing, with numbers rising daily.

In all, 2.12 million people were affected by the storm.

New Development Bank President Rouseff, who was president of the nation of Brazil from 2011 to 2016, emphasized in her announcement that the money should help restore basic services, reconstruct key infrastructure such as power, water, sanitation telecommunications, roadways, railways, and sanitation. It will also make it possible to rebuild homes, schools, and assist both agriculture and industry in regaining its footing as quickly as possible.

The financial equivalent of U.S. $1.15 billion will be allocated with approximately $250 million to get small and medium sized enterprises back on their feet. $295 million will go towards restoring local community development, putting in sanitation systems, and working on social infrastructure. $200 million will go to fixing existing roads, building new ones, repairing and reconstructing bridges, and other infrastructure works. Another $250 million will go to wastewater treatment systems, water infrastructure, disaster protection and future protection from similar extreme weather events, and environmental protections. Roughly $100 million will go to restoring the agricultural economy as much as possible and reestablishing infrastructure in support of logistics services. A final $20 million is designated for water projects, some business development, and urban mobility.

The money from the New Development Bank, which was supplied to a substantial extent from the BRICS member states, will be routed into the economy via multiple Brazilian national banks. Those will include the Regional Development Bank of the Far South (BRDE), Banco de Brazil (BB), and he National Economic and Social Development Bank (BNDES).

In her comments about the investments, Rousseff said it was important for the people of Brazil to know the New Development Bank will be helping in a big way at this critical time.

 "We want to help people rebuild their lives," she said.

Though the New Development Bank will not be the only source of money to rebuild Rio Grande do Sol, the $1.15 billion NDB will be providing is the largest offered to date from any provider. The amount of money is also reportedly over ten times what the World Bank pledged to help.

BRICS was founded by the countries of Brazil, Russia, India, China, and South Africa in 2009. On January 1 of this year, it admitted the countries of Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates into the group.

Today the expanded BRICS group comprises approximately 40% of the world’s population and 30% of the world’s total trade.