On July 8 local time, Chinese President Xi Jinping met with Russian President Vladimir Putin in Ufa, Russia. [Xinhua]

The world's attention was drawn to Russia last week, when two of China's newer partnership organizations held their summit meetings in Ufa, central Russia. The venue for the summit was no doubt chosen carefully by the Russians; far to the east of the major centers, Moscow and St Petersburg. It indicated that, just for once, Russia was not focusing on its complex relationship with the West, but that this relationship is counterbalanced by others, and that Russia can look elsewhere for friends if the West will not cooperate. Likewise, China, which recently has been much occupied with relations with the West and with diplomacy in the neighbouring East Asia region, was also keen to show the multi-polarity of its current approach to the world.

In the first place, the summit provided President Xi with an opportunity to confirm and develop the strong and friendly relations he has built up with Russia's President Putin. Both men are well aware that they are each strengthened by a firm display of common purpose and interests.

The BRICS summit concentrated on the arrangements for the organization's development finance initiative, the New Development Bank. In a world in which economic instability threatens from all sides, the participants decided to set up a US$100bn reserve currency pool, with the aim of protecting them from sudden lurches in currency values. This will be of assistance to one of the BRICS countries major common aims, to encourage the use of local currencies for settlements; this, of course, accords well with China's policy of promoting the use of the renminbi in international trade.

As for the bank's principal raison d'être, the funding of development projects in the BRICS countries, it was agreed that feasibility studies will take place before the end of this year. A major concern was expressed by Russian Finance Minister Anton Siluanov, named chairman of the board of the NDP: "We agreed that the procedures for adopting new projects will be simple, clear and transparent in order to make quick decisions, because the BRICS bank should be efficient and competitive." It is vital that the bank acquires a solid reputation for transparency and efficiency right from the start.

The leaders expressed hopes that the bank's first loan would be in place by April 2016. Allaying fears that the founding of the NDB might lead to mutually destructive competition with established organizations such as the IMF and the World Bank, it was announced that the first loan was likely to be made in an area where no existing development bank is currently active.