AIIB bid should not affect the country’s ties with US: MOF
Taiwan’s bid to enter the Asian Infrastructure Investment Bank ( AIIB, ) should not affect relations with either the U. S. or Japan, the Ministry of Finance ( MOF, ) said yesterday.
In a statement released yesterday, the Finance Ministry’s National Treasury Administration said 53 nations have applied to become founding members of China’s new financial venture.
Applicants i nclude major U. S. allies like the UK, which declared its intent on March 12, and France, Germany, Italy, South Korea, Australia and New Zealand.
“The two countries of the U. S. and Japan have recently expressed that they do not oppose the establishment of the AIIB, and have expressed that the World Bank and the Asian Development Bank ( ADB) can cooperate with the AIIB,” the statement continued.
The World Bank is a U. S.- led institution, while Japan has significant influence in the ADB.
“Therefore, after observing the latest international situation, we applied to join the AIIB. It should not affect our longstanding friendly relations with the U. S. and Japan,” the Finance Ministry said.
Taiwan applied to join the Beijing- backed financial institution on Tuesday, the application deadline for founding members. If accepted, Taiwan can expect to contribute NT$ 2.2 billion in capital subscription.
‘ Limited cost, multiple
Based on Taiwan’s experience in the ADB, potential investment in the AIIB will be limited, the Finance Ministry said yesterday.
The AIIB has authorized capital of US$ 100 billion, while the ADB has US$ 163.1 billion. If the AIIB follows a pattern of investment similar to the ADB, Taiwan’s annual contribution in the future should be limited, the ministry said.
Since joining the ADB in 1966, Taiwan has committed roughly NT$ 20 billion as of August 2014 — an average of only NT$ 42.43 million a year.
The Finance Ministry said Taiwan is applying to join the AIIB under the principle of “limited cost, multiple benefits.”
Participation can strengthen international exchanges and have the incidental effect of increasing cross- strait interactions.
Moreover, membership would result in a “tremendous market opportunity” for domestic manufacturers. Taiwan has long- and short- term investment funds and mature technologies but suffers a limited domestic market. Further regional economic integration is required in order to expand room for trade, according to the ministry.
The formal statement was released in the wake of opposition party criticism that Taiwan’s AIIB investment is a bad risk. In its editorial yesterday, the pan- green daily Liberty Times said “AIIB participation is paying money to be humiliated.”