57 countries to sign China-led Bank charter on Monday
June 25, 2015, 12:24 pm

File Photo: Chinese President Xi Jinping with German Chancellor Angela Merkel in Berlin, Germany [Xinhua]

Representatives of the countries will meet in Beijing on Monday to sign an agreement of the bank, the Chinese Foreign Ministry said on Thursday. All the five BRICS countries are also joining the new infrastructure investment bank.

The agreement on the $100 billion AIIB will then have to be ratified by the parliaments of the founding members, Chinese Foreign Ministry spokesman Lu Kang said at a daily press briefing in Beijing.

The AIIB is also the first major multilateral development bank in a generation that provides an avenue for China to strengthen its presence in the world’s fastest-growing region.

The US and Japan have not applied for the membership in the AIIB.

However, despite US pressures on its allies not to join the bank, Britain, France, Germany, Italy among others have signed on as founding members of the China-led Bank.

Meanwhile, New Zealand and Australia have already announced that they will invest $87.27 million and $718 million respectively as paid-in capital to the AIIB.

The new lender will finance infrastructure projects like the construction of roads, railways, and airports in the Asia-Pacific Region.

Chinese President Xi Jinping will meet with heads of delegations from the prospective founding countries on Monday, the Ministry said.

The AIIB will have an authorized capital of $100 billion and the initial subscribed capital is expected to be around $50 billion.

The bank, which will be headquartered in Beijing, is expected to be officially established at the end of 2015.

Developing Asia needs to spend $8 trillion between 2010 and 2020 on national infrastructure, according to an estimate by the Asian Development Bank (ADB).

The ADB is dominated by Japan and the US.

The BRICS New Development Bank and the Asian Infrastructure Investment Bank (AIIB) are both seen as alternatives to US – led institutions like the ADB and the World Bank.

China, with $4 trillion in foreign exchange reserves, is pushing for the growth of its own multilateral bodies, including the AIIB, the BRICS Bank and a bank for the Shanghai Cooperation Organization, but also seeking to strengthen its voice at the World Bank and the International Monetary Fund.

TBP and Agencies