China welcomes 2 more AIIB applicants
Print Edition
CHINA yesterday welcomed decisions by Denmark and Australia to apply to join the Asian Infrastructure Investment Bank.
Denmark filed its application on Saturday and yesterday Australia said it will sign an agreement to become a prospective founding member of the China-backed bank.
Should existing members approve the applications, Denmark will become a founding member on April 12 and Australia on April 13, China’s Ministry of Finance said yesterday.
Britain, France, Germany, Italy, Russia and the Netherlands have also announced plans to join.
Danish Minister of Trade and Development Mogens Jensen called China’s establishment of the AIIB “a significant and exciting development in the world order.”
“Since many Danish trade interests as well as development cooperation interests will be at stake in the AIIB, there are many reasons to engage in and influence the AIIB’s investment decisions from its beginning,” Jensen said.
China and 20 other countries signed a memorandum of understanding last October to establish the US$50 billion bank.
“Good progress has been made on the bank’s design, governance and transparency over the past few months, but we still have issues that we will address through ongoing consultations,” Australia’s Prime Minister Tony Abbott, Treasurer Joe Hockey and Foreign Minister Julie Bishop said in a joint statement yesterday.
“Key matters to be resolved before Australia considers joining the AIIB include the bank’s board of directors having authority over key investment decisions, and that no one country control the bank.”
The government said it would sign a memorandum of understanding which will allow Australia to take part in negotiations as a prospective founding member to set up the bank.
The ministers added that the AIIB “has the potential to play a valuable role in addressing infrastructure needs and boosting economic growth in the region with potential benefits for Australia.”
China has set a March 31 deadline to become a founding member of the AIIB and the founding members will be confirmed on April 15.
The Beijing-based bank, which will support infrastructure projects in Asia, is expected to be established by the end of this year.
China is expected to foot the bulk of the money needed to get the bank started, with donations from other members set to increase the size of the overall fund to more than US$100 billion.
The Asian Development Bank has estimated that there is an US$8 trillion deficit in Asia’s infrastructure fields, including transport, energy and telecommunications.
It was reported that Australia could invest up to A$3 billion (US$2.3 billion) in the new bank, which could lead to a wave of infrastructure development across the Asia-Pacific.
The US has urged countries to think twice about joining the AIIB until it could show sufficient standards of governance and environmental and social safeguards, with President Barack Obama’s administration waging an intense but low-profile lobbying campaign against the new institution.
Chinese President Xi Jinping said on Saturday that the nation’s new Asian investment schemes, including the AIIB, were not meant to displace existing regional programs.
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