AIIB to lend up to $15b ev­ery year, says top of­fi­cial

China Daily (Canada) - - LIFE - By ZHENG XIN zhengxin@chi­nadaily.com.cn

The Asian In­fra­struc­ture In­vest­ment Bank, the new in­ter­na­tional de­vel­op­ment ban­kled­byChina, planstolend $10 bil­lion to $15 bil­lion a year for the first five or six years, a top of­fi­cial said on Tues­day.

The new lender, which will be in­au­gu­rated later this month, plans to con­duct its first­board­meet­ingnextmonth and will sup­port in­fra­struc­ture de­vel­op­ment and con­nec­tiv­ity in Asia, said Jin Liqun, the pres­i­dent-des­ig­nate of the AIIB.

“The bank is nei­ther a Chi­ne­se­ban­knor abankownedby the Chi­nese gov­ern­ment, but one owned by all par­tic­i­pat­ing coun­tries,” said Jin in Beijing on Tues­day.

Jin­did not spec­i­fyany pri­or­ity projects for the AIIB or the coun­tries that would be the ben­e­fi­cia­ries of ini­tial loans, but said around 30 coun­tries are wait­ing in line for mem­ber­ship and this would in­crease the bank’s cap­i­tal.

“There are 50 ap­pli­cants in the fray for the po­si­tion of deputy head of the AIIB,” said Jin, the for­mer chair­man of in­vest­ment­bankChina In­ter­na­tional Cap­i­tal Corp.

Urg­ing Euro­pean ex­perts to join the lender, Jin said their ser­vices are nec­es­sary for the AIIB dur­ing the growth phase. Go­ing for­ward, the AIIB will look to jointly fund in­fra­struc­ture projects in Europe.

“The AIIB should not be lim­ited to Asian coun­tries, and it can only suc­ceed if Euro­pean and­coun­tries­fro­mother con­ti­nents join,” said Jin.

Jin, how­ever, said that the idea of hav­ing more mem­bers is not be­cause Asia is not up to the job, but rather the em­pha­sis that de­vel­oped coun­tries, par­tic­u­larly Euro­pean coun­tries, could share their ex­pe­ri­ences in run­ning in­ter­na­tional in­sti­tu­tions.

“It is crazy to re­ject any other coun­tries in the world and not to seek ad­vice in run­ning the bank, and for Euro­pean coun­tries, join­ing the AIIB is an op­por­tu­nity to do dif­fer­ent things and do things dif­fer­ently,” Jin said.

The United King­dom ap­plied to join the AIIB as a found­ing mem­ber in March, and this has prompted more Euro­pean coun­tries to fol­low suit, he said.

Suma Chakrabarti, pres­i­dent of the Euro­pean Bank for Re­con­struc­tion and De­vel­op­ment, said ear­lier that the AIIB has im­por­tant im­pli­ca­tions for EBRD as the com­bined strength of the two could al­low them to take on much larger projects.

EBRD­said it is keenly eye­ing op­por­tu­ni­ties to work closely with the AIIB.

Ac­cord­ing to Jin, the US dol­lar would be the op­er­at­ing cur­rency of the AIIB for its con­ve­nience while the bank would also take into con­sid­er­a­tion fi­nanc­ing re­quests in other cur­ren­cies, in­clud­ing the yuan.

In re­sponse to doubts and skep­ti­cism about the cre­ation of the AIIB and whether it will com­pete with ex­ist­ing in­sti­tu­tions, Jin said each phase of de­vel­op­ment should have a new­type of mod­ern institution to meet the needs of that time, cit­ing ex­am­ples like the Asian De­vel­op­ment Bank set up half a cen­tury ago.

Al­lay­ing con­cerns and the harsh, some­times hos­tile com­ments on what China needs to do and whether it was nec­es­sary to set up the AIIB, Jin said there is no doubt that Asia’s in­fra­struc­ture de­vel­op­ment will take off in the next 15 to 20 years.

“It’s im­por­tant to ex­plore the pos­si­bil­i­ties of a new type of bank and a new ap­proach to deal with the emerg­ing eco­nomic and so­cial de­vel­op­ment is­sues, as the back­log in Asia’s in­fra­struc­ture de­vel­op­ment has con­trib­uted to a bot­tle­neck in so­cial de­vel­op­ment, cli­mate change and other se­ri­ous prob­lems,” he said.

The bank has al­ready ini­ti­ated talks with other in­sti­tu­tions, in­clud­ing the ADB and the World Bank, said Jin.

CyrilMuller, for­mer di­rec­tor for bank­ing and debt man­age­ment in the World Bank Trea­sury, said in March dur­ing the Boao Fo­rum for 2015 Asia An­nual Con­fer­ence that AIIB could learn from pre­vi­ous ex­pe­ri­ence and co­op­er­ate with ex­ist­ing or­ga­ni­za­tions.

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