The Chinese Parliament has ratified the creation of the BRICS Development Bank. The New Development Bank was conceived as a counterbalance to such Western-led financial institutions as the World Bank and the IMF.

The new bank will provide money for infrastructure and development projects in BRICS countries, that is Brazil, Russia, India, China and South Africa. Each nation will have an equal say in the bank’s management, regardless of GDP size.

READ MORE: China to become biggest outward investor in 5ys – research

Each BRICS member is expected to contribute an equal share in establishing a startup capital of $50 billion, with a goal of reaching $100 billion in capitalization. The BRICS bank will be headquartered in Shanghai, with India presiding as president during the first year, and Russia serving as the chairman of the representatives.

China has pledged to contribute a total of $41 billion to the NDB bank, which will give it the largest voting rights, at 39.5 percent, Reuters reports.

The agreement has already been ratified in India and Russia.

In China, the creation of the NDB bank, also known as the BRICS Bank, has been approved by the Standing Committee of the National People's Congress at its meeting that runs until July 1.

It has been agreed that an African regional center of the NDB bank will be established in South Africa.

"BRICS bank can be world-changing". Analysis of basis of financial firepower of BRICS bank. http://t.co/aVKKx9bG0Dpic.twitter.com/3iJLYcc5Hk — John Ross (@JohnRoss43) June 15, 2015

The launch of the BRICS bank is seen as a first step in breaking the dominance of the US dollar in global trade, as well as dollar-backed institutions such as the International Monetary Fund (IMF) and the World Bank, both US-based institutions that BRICS countries have little influence within.

However, top policymakers in China and Russia, including President Vladimir Putin, have repeatedly stressed the Bank isn’t a replacement for the established Western institutions, but is complementary.

South Africa is expected to present ratification documents in July during a meeting of BRICS countries in the Russian city of Ufa.

READ MORE: GDP of BRICS could surpass G7 in 2-3 years - senior Duma MP

BRICS represents 42 percent of the world’s population and roughly 20 percent of the world’s economy based on GDP, and 30 percent of the world’s GDP based on PPP, a more accurate measure of real economic performance. Total trade between the countries amounts to $6.14 trillion, or nearly 17 percent of the world’s total.

READ MORE: BRICS should strive towards single market, promote tools for global economy control – China

The other bank being promoted by Beijng as an alternative to existing development institutions, such as the IMF and the World Bank, is the new Asian development bank, known as the Asian Infrastructure Investment Bank, created in October 2014. Britain and Germany are listed among its 57 member states.