G-20 deal sets up BRICS to backstop eurocrisis

One of the more controversial outbursts at the G-20 in Mexico this week came from European Commission President Jose Manuel Barroso, who, on the defense about the eurozone crisis, told reporters: “We are not coming here to receive lessons in terms of democracy or in terms of how to handle the economy.”

For many observers, it's also one of the most telling comments – underlining the way the world order is changing and how the traditional powerbrokers are reacting.

At a more micro level, these power shifts are on display at the G-20 in Los Cabos, Mexico, where emerging economies are pledging additional funds to the International Monetary Fund (IMF) in order to avert a European meltdown and its effect on the global economy.

According to Reuters, China has offered a $43 billion contribution to new IMF reserves. The other nations in the coalition of emerging world powers called the BRICS that includes Brazil, Russia, India, China, and South Africa, also agreed to increase donations to the IMF, with India, Brazil, and Russia pledging $10 billion and South Africa $2 billion. Mexico also pledged $10 billion.

“The amounts of money are not significant, but it is symbolic of a spirit of cooperation, and symbolic of the arrival of [emerging] countries,” says Manmohan Agarwal, a visiting fellow at The Center for International Governance Innovation in Ontario, and who has worked at the IMF and the World Bank.

Emerging markets have long sought more of a voice at international lending institutions, such as the IMF and World Bank – a desire highlighted by Agustin Carstens, head of Mexico's central bank, when he ran for the IMF's top spot against Christine Lagarde, who ultimately won.

The BRICS countries especially, whose growth has exceeded that of the developed world and today represent 18 percent of global economic output, have demanded more of a say.

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