Three simple steps to increase growth by 3%
Dmitriev proposes three simple steps to boost world growth by 3 percent: reduce restrictions on capital flows, encourage private capital to go into infrastructure, and thirdly to make infrastructure investment more efficient.
“If you do those three things we believe world economic growth will go up by 3 percent and we have some specific ideas, so I think the developmental bank is the solution,” he told RT.
The development bank, which is being set up by the five BRICS nations - Brazil, Russia, China, India and South Africa - is set to rival the World Bank and the International Monetary Fund (IMF) in terms of its spending power. It’s initial size was agreed at $100 billion at the G20 summit on Thursday, and is planned to be up and running by 2015.
Dmitriev believes the solution to world growth lies in investing in infrastructure and with 40% of the world’s currency reserves the BRICS nations will be crucial in providing the finance for that.
“The world faces 60 trillion dollars of infrastructure needs until 2030, where do you fund this money, how do you find this capital? A development bank may be part of the solution,” he told RT.
At a meeting of business leaders and labor union representatives on Friday Dmitriev repeated his belief in the future need for large scale investment in infrastructure, citing the trillion dollar annual losses from inefficient infrastructure investment.
World growth for 2012 was just above 3 percent, with mature economies still bearing the scars of the economic crisis. Emerging markets did not pick up the slack in 2012 and are not expected to do so in 2013.