Gov­ern­ments sign pact to cre­ate China-led Asia in­vest­ment bank

The China Post - - FRONT PAGE -

En­voys of gov­ern­ments that plan to join a main­land China-led Asian bank en­dorsed a struc­ture Mon­day that gives Bei­jing the big­gest vot­ing stake at the start but no veto power.

Each mem­ber of the Asian In­fra­struc­ture In­vest­ment Bank will re­ceive vot­ing shares in line with its con­tri­bu­tion to the bank’s planned US$100 bil­lion in cap­i­tal, un­der the pro­posed struc­ture. As the big­gest donor, Bei­jing would get 26 per­cent of votes, with In­dia in sec­ond-place with 7.5 per­cent and Rus­sia third with 5.9 per­cent.

Bei­jing’s pro­posal for the AIIB at­tracted un­ex­pect­edly wide sup­port from U.S. al­lies in­clud­ing the United King­dom, New Zealand, France, Aus­tralia and South Korea de­spite U.S. op­po­si­tion. The U.S. and its ally Ja­pan have re­frained from seek­ing mem­ber­ship.

The Bei­jing- based bank is part of main­land China’s ef­forts to gain a big­ger voice in global fi­nan­cial reg­u­la­tion that is dom­i­nated by the United States and Europe.

The bank is in­tended to fi­nance in­vest­ments in rail­ways, cargo ports and other trade links. The U.S. gov­ern­ment had ob­jected that the bank would un­der­cut ex­ist­ing in­sti­tu­tions such as the World Bank and might al­low looser lend­ing stan­dards.

Some 57 gov­ern­ments have ex­pressed in­ter­est in join­ing the AIIB, but not all signed Mon­day’s agree­ment. The Philip­pines said it and six other coun­tries in­clud­ing Thai­land and South Africa would not sign im­me­di­ately and had un­til De­cem­ber to make a fi­nal de­ci­sion.

“This pro­posal was de­signed to meet Asia’s in­fra­struc­ture de­vel­op­ment and pro­mote Asia’s con­nec­tiv­ity and also deepen re­gional co­op­er­a­tion for the sake of de­vel­op­ment,” said main­land leader Xi Jin­ping dur­ing a meet­ing with the for­eign en­voys in the Great Hall of the Peo­ple in cen­tral Bei­jing.

“The very fact that rep­re­sen­ta­tives from the 57 prospec­tive found­ing mem­bers are gath­er­ing in this room to­day is tes­ti­mony to this spirit of sol­i­dar­ity, co­op­er­a­tion, open­ness and in­clu­sive­ness.”

The main­land’s vot­ing share may be di­luted as more mem­bers join, fi­nance of­fi­cial Shi Yaobin told the of­fi­cial Xin­hua News Agency.

“(The main­land) is not de­lib­er­ately seek­ing a veto power,” said Shi, ac­cord­ing to Xin­hua.

The bank will be led by a pres­i­dent with a five-year term that can be ex­tended once. Its work­ing lan­guage will be English.

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