In its present shape and size the BRICS Contingent Reserve Arrangement (CRA) should be regarded as symbolic and exploratory rather than as a substantive challenger to the International Monetary Fund (IMF). However, the momentum of the BRICS process and the experience of the similar Association of Southeast Asian Nations plus Three (ASEAN+3) process suggest that the CRA has the potential to develop in two directions. Firstly, it should aim to become an adequate safety net and provide high-quality macroeconomic monitoring, and hence ensure participating countries’ independence from the IMF. Secondly, it should aim to draw in other emerging economies. However, the CRA in itself does not represent a significant break from prevailing orthodoxy. Its limited scope may condemn it to playing a bit part in the global financial system.

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Authors: Nicolette Cattaneo, Mayamiko Biziwick & David Fryer; South African Institute for International Affairs