Canada applies to AIIB
After agreeing to put a dispute over canola exports on hold, Canada and China are cozying up even more during Prime Minster Justin Trudeau’s visit to Beijing.
Canadian Finance Minister Bill Morneau announced that Canada is applying to join the China-led Asian Infrastructure Investment Bank (AIIB).
AIIB President Jin Liqun welcomed Canada’s decision, which he said “shows its confidence in the strong foundations the bank has built in our first few months”.
“Canada has a remarkable track record of multilateral engagement, and I believe it will contribute significantly to the development of this bank,” said Jin at a news conference in Beijing.
The Canadian government made the announcement after the prime minister met with Chinese Premier Li Keqiang on Wednesday in Beijing.
Canada would be the first North American member of the bank.
“The Canadians’ decision to join this bank will greatly strengthen the management of this institution,” Jin told reporters. “We can see that the US’ attitude towards the AIIB is showing signs of changing, as it is encouraging the World Bank to coopearate more with the AIIB.”
With the aim to support infrastructure in the AsiaPacific region, the AIIB became operational in January during its inaugural board of governors meeting.
With a total capital of US$100 billion, it is comparable in size to other multilateral development banks.
Currently, there are 57 members and Jin said there will be more than 90 by the end of the year.
Regional members hold 75 per cent of the bank’s capital, with China being the largest shareholder.
Morneau, who met with AIIB president Jin Liqun on Wednesday, said that joining the bank will help Canada further engage in multilateral infrastructure efforts, and help pave the way for Canadian companies looking for new business opportunities.
“They have put forward approaches to governance, approaches to management at the institution that show us the impact that’s possible for those Canadian companies that will be part of the work that the AIIB does,” Morneau said.
The AIIB has already invested more than $500 million in Bangladesh, Indonesia, Pakistan and Tajikistan, and Chinese officials have said it plans to loan out $10 billion to 15 billion over the next five years.
Morneau said that helping fund high-quality infrastructure in Asia will contribute to global economic growth, as well as help Canadian companies explore new opportunities.
“Canada can also make constructive contributions to the AIIB, thanks to our country’s proud tradition of international leadership on the global stage,” he said.
“The move shows that Canada supports China’s assuming a leadership role in the liberal international order in trade, finance and poverty alleviation based on reciprocal mutual benefit and respect for environment, labour rights and economic transparency,” Charles Burton, a former Canadian diplomat and expert in Canada-China relations at Brock University, told China Daily.
Su Ge, president of the China Institute of International Studies, said: “It’s a wise decision for Canada to join the AIIB. The move is beneficial for both sides.”
Su said it will help prove the AIIB’s value and give Canada a new platform for international investment.
According to Burton, Trudeau hopes to set up a mechanism for annual meetings with the Chinese leadership. He also hopes to reinvigorate the CanadaChina Strategic Dialogue between Canadian cabinet ministers and their Chinese counterparts.
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Jin Liqun, president of the Asian Infrastructure Investment Bank, and Canadian Finance Minister Bill Morneau attend a news conference in Beijing on Wednesday.