AIIB (Asian Infrastructure Investment Bank) news

[ahojunk]

I sincerely hope Taiwan is successful in joining the AIIB as "an economic entity."
Not being a member means being left out of Asian infrastructure projects.

-------------------------
Taiwan AIIB entry is 'highly probable,' says Chinese official - The China Post

Taiwan AIIB entry is 'highly probable,' says Chinese official
By Yuan-Ming Chiao, The China Post
April 19, 2015, 12:03 am TWN

TAIPEI, Taiwan -- Mainland China's Deputy Minister of Finance Zhu Guangyao (朱光耀) said Friday that Taiwan's chances of entering the Asian Infrastructural Investment Bank (AIIB, 亞投行) had a high probability. Zhu made the comment while attending a meeting of the Atlantic Council (大西洋理事會), a Washington-based think tank.
When questioned by a reporter from the Central News Agency regarding the suitability of Taiwan's participation under the designation “Chinese Taipei,” Zhu voiced his country's support for the island's bid for membership as “an economic entity.” He added that previous international practice for Taiwan's participation under this formula included the World Trade Organization (as “Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu”) and APEC (under “Chinese Taipei”).

Zhu said that extensive negotiations were under way with Taiwan regarding the designation issue. Taiwan's Ministry of Finance (MOF) responded to Zhu's comments in Washington by confirming that negotiations over an appropriate name for its AIIB participation were in fact taking place. It reiterated the stance of “dignity and equality” as required principles for membership.

Scholars Advocate Awareness on AIIB

Meanwhile, scholars pushed for greater public awareness of the international context behind China's AIIB motivations. The R.O.C. International Studies Association (中華民國國際關係學會) held a discussion forum yesterday at National Taiwan University on the possible effects of the AIIB on Taiwan. The event was led by local scholars including the association's president and former Deputy Secretary-General of the National Security Council Philip Yang (楊永明) and Mignonne Chan (詹滿容), founder of Out-of-the-Box Consultancy (方外智庫) and former senior advisor to the president at the National Security Council.

While answering questions from the public and media present, the scholars agreed that the formation of the AIIB represented a watershed moment in recent history since the Cold War. Yang said that the investment bank belongs to Asia and the world, and that Taiwan needs to face new historical circumstances. He argued that the government needs to take a more proactive stance, including departmental and ministerial meetings and more consultations with other countries in APEC.

Chan argued that bank participation would bring more opportunities to the island's small and medium-sized enterprises, and that it presented a better alternative to “building a cart behind closed doors.” She also questioned the issue of the AIIB's operational transparency, a subject broached by the U.S. and its ally Japan, both of which have not applied to join the bank as “a non-issue.”

The scholars also emphasized the need for public awareness on the larger international context at play in China's decision to form the AIIB. Tsai Tung-chieh, a professor at National Chung Hsin University urged the public to utilize the wide ranging number of Internet-based sources to educate themselves on the issue, rather than wait for government explanations. Li Da-jung, a professor at Tamkang University added that Taiwan cannot sustain itself without taking international trends into consideration.

”The world will not cease to move forward because of Taiwan,” Li said.
.

 

[ahojunk]

Ha Ha! Some advice for AIIB:-
- be client-focused, look for what is best in their interests
- be humble and constantly learning
- cooperate with other institutions
All these are just plain common sense.

--------------------------------------
Interview: Client-focused, humble learning, cooperation are key lessons for AIIB's success
English.news.cn 2015-04-20 07:09:12

By Xinhua writer Gao Pan


WASHINGTON, April 19 (Xinhua) -- As representatives of the 57 founding countries gather later this month to prepare for the establishment of the Asian Infrastructure Investment Bank (AIIB), a former World Bank official suggested that the new institution could draw three important lessons from the operational experiences of multilateral development banks over the last five decades to become more successful.

"The first is how important it is to be client-focused, to make sure the clients, the developing countries, to decide what's in their best interests," said Vikram Nehru, a former World Bank chief economist for East Asia and a senior associate in the Asia Program at the Carnegie Endowment for International Peace, a Washington-D.C. based think tank.

"Ensuring the developing countries in the driver's seat is absolutely central" to the success of the China-proposed AIIB, Nehru told Xinhua in a recent interview on the sidelines of the spring meetings of the International Monetary Fund (IMF) and World Bank.

As a new multilateral institution focusing exclusively on infrastructure development, the AIIB, said China, will be dominated by developing countries, and their requests and demands need to be respected.

The establishment of the AIIB is an attempt to help fill Asia's infrastructure investment gap and promote economic development in the region, China's vice finance minister Zhu Guangyao said Friday in a speech at the Atlantic Council, another U.S. think tank, noting that India and other Asian countries are now facing the same challenge of infrastructure bottleneck.

The Asian Development Bank (ADB) estimated in 2009 that Asia needs about 8 trillion U.S. dollars in investment by 2020 to improve the region's battered infrastructure to keep its economies humming.

The second lesson for the AIIB is to be "humble" and " constantly learning from local circumstances, local facts and experiences from other countries to see what works best," said Nehru, who served in a number of senior management positions in the World Bank from 1981 to 2011.

Representatives of the 57 founding countries, which were finalized Wednesday, will convene at the end of April, and May to deliberate on the AIIB charter, of which management structure will be the most important part.

China has said the AIIB will draw experiences from other multilateral development banks and avoid their detours so as to be more cost-effective and efficient. The new bank will feature a three-level management structure that includes a board of governors, board of directors and senior management, according to the Chinese Finance Ministry.

Zhu said there are many debates about whether or not the AIIB should have a resident board of directors commonly adopted by the World Bank and the ADB. The intention of these debates is to "increase efficiency and improve the capacity" of the bank to better serve the clients, but it will be finally decided by coming negotiations among founding members, he said.

Nehru believes it's a good idea to have a non-resident board of directors for the AIIB, as it would help make a clear distinction between the board and the management, and also have great accountability.

"When you have a non-resident board, then when the board meets periodically, it has to focus on the policies of the institution and its strategy, leaving up to the management to implement those policies and that strategy," he said.

The third lesson for the AIIB "would be to cooperate with other institutions" to apply the best standards, said Nehru, noting that cooperation between the AIIB and existing institutions will make sure developing countries "get the best services" from multilateral development bank community.

The heads of the World Bank and the ADB have welcomed the AIIB with open arms, pledging to strengthen cooperation with the new multilateral institution.

"Infrastructure needs in the developing world are enormous. They are enormous in Asia for AIIB. Our full expectation is that we will continue to work closely," World Bank President Jim Yong Kim said Thursday at a press conference.

With initial subscribed capital of 50 billion U.S. dollars and planned authorized capital of 100 billion dollars, China is also aware that the bank and its members alone cannot bridge the funding gap in Asia.

The AIIB is intended to play a complementary role alongside existing multilateral development banks, and China welcomes the World Bank and the ADB to increase infrastructure investment, Zhu said.

Nehru suggested that the AIIB could start cooperating with the World Bank and the ADB through co-financing for existing infrastructure projects which are already in the pipeline.

If the AIIB wants to cooperate with the private sector on financing individual infrastructure projects and raise capital from international financial markets, it has to meet high international standards in terms of environmental evaluation and social safeguards, Nehru noted.

"We agree with high standards, and opinions will be gathered through negotiations and reflected in the formal legal document," Zhu echoed.

With the signing of the charter slated for the end of June, the AIIB looks set to be launched by the end of the year.

If the AIIB could draw valuable lessons from existing multilateral development banks, there is no reason to believe that this new initiative could not be successful, many global finance officials agreed during the spring meetings.

Nehru said it's "quite remarkable" for the AIIB to already have 57 founding members from Asia, Europe and the Middle East, as the ADB has just 67 members today after so many decades of operation.

"I believe Chinese authorities want to have a modern, global, and high-quality institution," he added.
.

 

[TaiShang]

COMMENTARY / JAPAN | SENTAKU MAGAZINE
Why Japan won’t join the AIIB

The world has been shaken by the decisions of major Western European powers to join China’s scheme of creating the Asian Infrastructure Investment Bank (AIIB), which have left Japan and the United States out of the picture — as intended by Beijing.

Initially the supporters of the plan were limited mainly to developing countries in Asia. On March 12, however, Britain surprised the world by announcing its intention to become a founding member of the bank. This news was followed soon by similar announcements by Germany, France and Italy.

A major question now is whether the AIIB will become a savior for Asia, which faces enormous needs for infrastructure-related construction projects or will the bank become a tool to help China gain hegemony in the region. Japan holds the key.

The recent turn of events in favor of China has had a strong impact on Japan, which had sought to join hands with countries like the United States, Britain and Germany to prevent China from gaining economic dominance in Asia. A Finance Ministry official described the development as serious as the one that Japan faced in 1939 when Nazi Germany concluded a nonaggression pact with the Soviet Union, which Tokyo regarded as a potential enemy.

Even though there are voices within Japan’s political, bureaucratic and academic circles favoring Tokyo’s participation in the AIIB scheme, the administration of Prime Minister Shinzo Abe has adopted a policy of not permitting the expansion of China’s economic influence, insisting that infrastructure-construction needs in Asia should be met by strengthening the Asian Development Bank (ADB), which is principally under a Japan-U.S. umbrella.

The AIIB scheme was first announced by Chinese President Xi Jinping in 2013 as an international financial institution to fund rapidly growing infrastructure projects in Asia. Among those agreeing to become founding members were the Association of Southeast Asian Nations (ASEAN) countries, Kazakhstan and other Central Asian states, India, Saudi Arabia and a few other Middle-Eastern oil rich countries, and New Zealand.

As Britain, Germany, France, Italy, Switzerland and Luxemburg announcing their intentions to take part in the AIIB, the number of prospective founding members of the bank grew to 33. In addition, Australia’s participation was certain as 40 percent of its iron ore and natural gas exports goes to China. South Korea, which relies on China for 25 percent of its exports, announced that it would join on March 26 despite Washington’s call against such an action. [The number of founding members eventually expanded to 57.]

The AIIB will have an initial paid-up capital of $50 billion (about ¥6 trillion), of which one half will be contributed by China. With its headquarters likely to be in Beijing, the bank will probably be headed by Jin Liqun, the former head of the China International Capital Corp. who once served as vice president of the ADB. With so much Chinese influence, the bank can without much exaggeration be called “a financial institution by China and for China.”

The ADB, the rival of the AIIB, was founded in 1966 with the participation of 31 countries and regions not only from Asia but also from North America and Europe. The ratios of its capital contribution are quite diversified, with Japan accounting for 15.67 percent, the U.S. 15.56 percent, China 6.47 percent, India 6.35 percent, Australia 5.8 percent, Canada 5.25 percent, Indonesia 5.17 percent and South Korea 5.05 percent. Headquartered in Manila, its president’s office has to date been occupied by Japanese.

The ADB maintains fairness and impartiality as applications for loans are screened by its Board of Governors, which is made up of representatives from all member nations so that no one country exerts undue influence.

The AIIB, on the other hand, not only will be under strong Chinese influence but also will not have such a board for screening loan applications. It is said that since the days when he was ADB vice president, Jin has been of the opinion that decision making by the board was a waste of time and prevented quick action.

Thus once the AIIB starts its operations, nobody would be able to stop Beijing from making unilateral decisions. Another way of looking at it is that the bank will become a tool for implementing the external economic policies of the Chinese Communist Party, enabling China to use funds contributed by other countries for projects that best suit its own strategies.

The reason why major industrialized economies initially hesitated to join the AIIB scheme was that such ulterior motives of Beijing were obvious and also that they feared the possibility of Asia becoming dominated by China. This stance allowed those countries without uttering any words to persuade Beijing to follow global standards in structuring the AIIB, and to make it a democratic and highly transparent financial institution that contributes to economic development.

Therefore the negative impact of Britain’s about-face is all the more far-reaching. While welcoming London’s move, Beijing warned Germany and France that unless they join the bank, they would not only be put into disadvantageous positions in doing business with China but also be discriminated against in the bank’s loan projects.

These were serious threats to both countries as China is the largest market for Volkswagen Group of Germany while Areva SA of France has won many orders to build nuclear reactors in China and is looking for more. Britain hopes that China’s leading corporations and banks will raise funds in the City of London. Perhaps the West European powers are not worried about China’s exercise of greater hegemony in Asia because of the huge distance separating them from Asia.

Although the idea of making the AIIB an impartial international financial institution through inside efforts after joining it may sound feasible, no member countries will be able to clash head on with China and change the AIIB since Europe is preoccupied with its own problems, like the situation in Greece. Should one country make such an attempt, Beijing would likely respond with “divide and rule” tactics, threatening to give more favorable terms to other countries.

Japan and the U.S. are faced with a different kind of pressure because if the AIIB is established in the form now being contemplated, China will likely have a strong voice in international tenders for AIIB-funded projects. If the bank adopts an explicit or implicit rule that bidding is limited to corporations from AIIB member-nations, Japanese and American companies will automatically be excluded from major AIIB-funded projects, leading them to beg their governments to join the bank. This would be another victory for China’s divide and rule tactics.

The ADB estimates that an annual sum of $750 billion (about ¥90 trillion) is needed for Asian infrastructure projects to build and improve roads, railways, dams, electric power stations, airports and so on. It is clear that this sum far exceeds what can be provided by the ADB, the World Bank, the Japan Bank for International Cooperation (JBIC), export-import banks of various countries, and other public and private sector financial institutions.

That is why many policymakers and experts agree on the need to create a bank devoted exclusively to funding new medium- to long-term infrastructure projects.

But such projects include dam and pipeline construction, which, it is feared, could damage the ecosystem or lead to the eviction of local residents without proper compensation. Another source of concern is that the project contract system could spawn graft and other forms of corruption.

It is highly questionable whether the AIIB will be capable of filling its social responsibilities by fully comprehending and coping with these and other problems when selecting appropriate projects.

Xi’s vigorous anti-corruption campaign shows that corruption in both China’s private and public sectors is serious. It is simply too naive to believe that a banking institution run by such corrupt government officials will perform its public duties in a fair and clean manner.

Late in September 2011, President Thein Sein of Myanmar revoked a $3.6 billion (¥43 billion) Chinese project to construct a hydroelectric power station in Kachin state. Known as the Myistone Dam project, it would have sent to China the entire 6 million kilowatts of electricity it was supposed to generate. Thein Sein took the action out of concern over environmental damage and corruption — the very issues that many worry will result from the Chinese-run AIIB.

In March, Narendra Modi became the first Indian prime minister to visit Sri Lanka in 28 years for talks with President Maithripala Sirisena, putting an end to a protracted period in which their two countries were at loggerheads.

For nearly three decades, Sri Lanka relied on economic assistance from China. But Sirisena won the presidential election in January with a campaign promise to free the country from the influence of Beijing, which has attempted to make the country a satellite by building naval and other facilities.

These moves by Myanmar and Sri Lanka indicate that China is beginning to face a deadlock in its pursuit of a strategy of gaining economic and military footholds in Asian developing countries by providing them with monetary aid.

With suspicions about China’s policies growing among Asian countries, Beijing must have thought that aid to them through the AIIB would be more palatable than direct aid from the Chinese government, again proving that the bank scheme is but a tool for implementing China’s diplomatic strategies.

The ultimate goal of establishing the AIIB is to implement the “one belt, one road” initiative proposed by Xi. The “one belt” is a new overland Silk Road connecting inland China with the Central Asia and the Middle East. It would consist of highways and railroads that would facilitate industrial and economic development along the route. The “one road” is a maritime trade route spanning from China to the Middle East via the South China Sea, the Strait of Malacca and the Indian Ocean.

Behind the two-route initiative is China’s energy security strategy as Beijing seeks to ensure supply of oil, natural gas and other energy sources, and to obtain the right to develop natural resources. It also hopes that those routes will facilitate the export of steel, cement, home electric appliances, electronic products, automobiles, clothing and other manufactured goods as China is now stuck with excessive production capacity. Another hope is placed on the growth of Chinese corporations in the fields of construction and engineering.

In short, China needs the AIIB to achieve all these aims.

For the one belt, one road initiative, China created a “Silk Road Fund” of $40 billion late last year. But this sum is just for pump priming and the truly necessary funds will come from the AIIB.

Such being China’s true intentions, it is only natural for Japan to decline to join the AIIB. Japan will do well if it continues to cooperate in infrastructure projects in Asia by strengthening the ADB and working in close collaboration with the World Bank and the United Nations. Before long it will become clear on which side justice is, Japan or China.

***

 

[mike2000 is back]

COMMENTARY / JAPAN | SENTAKU MAGAZINE
Why Japan won’t join the AIIB

The world has been shaken by the decisions of major Western European powers to join China’s scheme of creating the Asian Infrastructure Investment Bank (AIIB), which have left Japan and the United States out of the picture — as intended by Beijing.

Initially the supporters of the plan were limited mainly to developing countries in Asia. On March 12, however, Britain surprised the world by announcing its intention to become a founding member of the bank. This news was followed soon by similar announcements by Germany, France and Italy.

A major question now is whether the AIIB will become a savior for Asia, which faces enormous needs for infrastructure-related construction projects or will the bank become a tool to help China gain hegemony in the region. Japan holds the key.

The recent turn of events in favor of China has had a strong impact on Japan, which had sought to join hands with countries like the United States, Britain and Germany to prevent China from gaining economic dominance in Asia. A Finance Ministry official described the development as serious as the one that Japan faced in 1939 when Nazi Germany concluded a nonaggression pact with the Soviet Union, which Tokyo regarded as a potential enemy.

Even though there are voices within Japan’s political, bureaucratic and academic circles favoring Tokyo’s participation in the AIIB scheme, the administration of Prime Minister Shinzo Abe has adopted a policy of not permitting the expansion of China’s economic influence, insisting that infrastructure-construction needs in Asia should be met by strengthening the Asian Development Bank (ADB), which is principally under a Japan-U.S. umbrella.

The AIIB scheme was first announced by Chinese President Xi Jinping in 2013 as an international financial institution to fund rapidly growing infrastructure projects in Asia. Among those agreeing to become founding members were the Association of Southeast Asian Nations (ASEAN) countries, Kazakhstan and other Central Asian states, India, Saudi Arabia and a few other Middle-Eastern oil rich countries, and New Zealand.

As Britain, Germany, France, Italy, Switzerland and Luxemburg announcing their intentions to take part in the AIIB, the number of prospective founding members of the bank grew to 33. In addition, Australia’s participation was certain as 40 percent of its iron ore and natural gas exports goes to China. South Korea, which relies on China for 25 percent of its exports, announced that it would join on March 26 despite Washington’s call against such an action. [The number of founding members eventually expanded to 57.]

The AIIB will have an initial paid-up capital of $50 billion (about ¥6 trillion), of which one half will be contributed by China. With its headquarters likely to be in Beijing, the bank will probably be headed by Jin Liqun, the former head of the China International Capital Corp. who once served as vice president of the ADB. With so much Chinese influence, the bank can without much exaggeration be called “a financial institution by China and for China.”

The ADB, the rival of the AIIB, was founded in 1966 with the participation of 31 countries and regions not only from Asia but also from North America and Europe. The ratios of its capital contribution are quite diversified, with Japan accounting for 15.67 percent, the U.S. 15.56 percent, China 6.47 percent, India 6.35 percent, Australia 5.8 percent, Canada 5.25 percent, Indonesia 5.17 percent and South Korea 5.05 percent. Headquartered in Manila, its president’s office has to date been occupied by Japanese.

The ADB maintains fairness and impartiality as applications for loans are screened by its Board of Governors, which is made up of representatives from all member nations so that no one country exerts undue influence.

The AIIB, on the other hand, not only will be under strong Chinese influence but also will not have such a board for screening loan applications. It is said that since the days when he was ADB vice president, Jin has been of the opinion that decision making by the board was a waste of time and prevented quick action.

Thus once the AIIB starts its operations, nobody would be able to stop Beijing from making unilateral decisions. Another way of looking at it is that the bank will become a tool for implementing the external economic policies of the Chinese Communist Party, enabling China to use funds contributed by other countries for projects that best suit its own strategies.

The reason why major industrialized economies initially hesitated to join the AIIB scheme was that such ulterior motives of Beijing were obvious and also that they feared the possibility of Asia becoming dominated by China. This stance allowed those countries without uttering any words to persuade Beijing to follow global standards in structuring the AIIB, and to make it a democratic and highly transparent financial institution that contributes to economic development.

Therefore the negative impact of Britain’s about-face is all the more far-reaching. While welcoming London’s move, Beijing warned Germany and France that unless they join the bank, they would not only be put into disadvantageous positions in doing business with China but also be discriminated against in the bank’s loan projects.

These were serious threats to both countries as China is the largest market for Volkswagen Group of Germany while Areva SA of France has won many orders to build nuclear reactors in China and is looking for more. Britain hopes that China’s leading corporations and banks will raise funds in the City of London. Perhaps the West European powers are not worried about China’s exercise of greater hegemony in Asia because of the huge distance separating them from Asia.

Although the idea of making the AIIB an impartial international financial institution through inside efforts after joining it may sound feasible, no member countries will be able to clash head on with China and change the AIIB since Europe is preoccupied with its own problems, like the situation in Greece. Should one country make such an attempt, Beijing would likely respond with “divide and rule” tactics, threatening to give more favorable terms to other countries.

Japan and the U.S. are faced with a different kind of pressure because if the AIIB is established in the form now being contemplated, China will likely have a strong voice in international tenders for AIIB-funded projects. If the bank adopts an explicit or implicit rule that bidding is limited to corporations from AIIB member-nations, Japanese and American companies will automatically be excluded from major AIIB-funded projects, leading them to beg their governments to join the bank. This would be another victory for China’s divide and rule tactics.

The ADB estimates that an annual sum of $750 billion (about ¥90 trillion) is needed for Asian infrastructure projects to build and improve roads, railways, dams, electric power stations, airports and so on. It is clear that this sum far exceeds what can be provided by the ADB, the World Bank, the Japan Bank for International Cooperation (JBIC), export-import banks of various countries, and other public and private sector financial institutions.

That is why many policymakers and experts agree on the need to create a bank devoted exclusively to funding new medium- to long-term infrastructure projects.

But such projects include dam and pipeline construction, which, it is feared, could damage the ecosystem or lead to the eviction of local residents without proper compensation. Another source of concern is that the project contract system could spawn graft and other forms of corruption.

It is highly questionable whether the AIIB will be capable of filling its social responsibilities by fully comprehending and coping with these and other problems when selecting appropriate projects.

Xi’s vigorous anti-corruption campaign shows that corruption in both China’s private and public sectors is serious. It is simply too naive to believe that a banking institution run by such corrupt government officials will perform its public duties in a fair and clean manner.

Late in September 2011, President Thein Sein of Myanmar revoked a $3.6 billion (¥43 billion) Chinese project to construct a hydroelectric power station in Kachin state. Known as the Myistone Dam project, it would have sent to China the entire 6 million kilowatts of electricity it was supposed to generate. Thein Sein took the action out of concern over environmental damage and corruption — the very issues that many worry will result from the Chinese-run AIIB.

In March, Narendra Modi became the first Indian prime minister to visit Sri Lanka in 28 years for talks with President Maithripala Sirisena, putting an end to a protracted period in which their two countries were at loggerheads.

For nearly three decades, Sri Lanka relied on economic assistance from China. But Sirisena won the presidential election in January with a campaign promise to free the country from the influence of Beijing, which has attempted to make the country a satellite by building naval and other facilities.

These moves by Myanmar and Sri Lanka indicate that China is beginning to face a deadlock in its pursuit of a strategy of gaining economic and military footholds in Asian developing countries by providing them with monetary aid.

With suspicions about China’s policies growing among Asian countries, Beijing must have thought that aid to them through the AIIB would be more palatable than direct aid from the Chinese government, again proving that the bank scheme is but a tool for implementing China’s diplomatic strategies.

The ultimate goal of establishing the AIIB is to implement the “one belt, one road” initiative proposed by Xi. The “one belt” is a new overland Silk Road connecting inland China with the Central Asia and the Middle East. It would consist of highways and railroads that would facilitate industrial and economic development along the route. The “one road” is a maritime trade route spanning from China to the Middle East via the South China Sea, the Strait of Malacca and the Indian Ocean.

Behind the two-route initiative is China’s energy security strategy as Beijing seeks to ensure supply of oil, natural gas and other energy sources, and to obtain the right to develop natural resources. It also hopes that those routes will facilitate the export of steel, cement, home electric appliances, electronic products, automobiles, clothing and other manufactured goods as China is now stuck with excessive production capacity. Another hope is placed on the growth of Chinese corporations in the fields of construction and engineering.

In short, China needs the AIIB to achieve all these aims.

For the one belt, one road initiative, China created a “Silk Road Fund” of $40 billion late last year. But this sum is just for pump priming and the truly necessary funds will come from the AIIB.

Such being China’s true intentions, it is only natural for Japan to decline to join the AIIB. Japan will do well if it continues to cooperate in infrastructure projects in Asia by strengthening the ADB and working in close collaboration with the World Bank and the United Nations. Before long it will become clear on which side justice is, Japan or China.

***

LMAO...... Why are people shocked to see Britain joining the bank first among the west and thereby opening the floodgates for others? Anyway, s I said we are a pragmatic nation who has always looked after its interests first and foremost. This should again be a lesson to some naive Chinese members who seem to think e have no influence/role in world affairs. Truth is without us this AIIB will be just a small institution with few Asian countries as members. So they have to thank our insignificant island for making their bank so successful/influential even before it starts.
We have always been good strategists(in fact i might argue the bests in the World.). After all we didn't win two world wars, ruled the world(such a small island), spread our language and culture the world over by mistake/luck. So the U.S and even more surprising Japan should chill down and stop talking shit/questioning us about why we decided to join AIIB thus making others who might not have joined to follow suit. We all are after our interests first and foremost, full stop. We joined it for a reason(they will see later)

 

[AndrewJin]

LMAO...... Why are people shocked to see Britain joining the bank first among the west and thereby opening the floodgates for others? Anyway, s I said we are a pragmatic nation who has always looked after its interests first and foremost. This should again be a lesson to some naive Chinese members who seem to think e have no influence/role in world affairs. Truth is without us this AIIB will be just a small institution with few Asian countries as members. So they have to thank our insignificant island for making their bank so successful/influential even before it starts.
We have always been good strategists(in fact i might argue the bests in the World.). After all we didn't win two world wars, ruled the world(such a small island), spread our language and culture the world over by mistake/luck. So the U.S and even more surprising Japan should chill down and stop talking shit/questioning us about why we decided to join AIIB thus making others who might not have joined to follow suit. We all are after our interests first and foremost, full stop. We joined it for a reason(they will see later)

British created India as a nation, biggest work ever!

 

[mike2000 is back]

British created India as a nation, biggest work ever!

To be honest, there are many other nations we created from Africa to middle east. So you don't have to pick on only India.

Anyway , as I said before Japan won't join and even if it did, it will be the last country to ever do so if ever. The AIIB is a threat to Japan's influence/dominance in Asia more than any other country(yes more than even the mighty U.S). Its not in Japans interest to join, so Japan won't join and will try as much as possible to act as a spoiler. I don't think there's anything wrong in this though, geo politics is not a clean game, any trick is allowed So Japan will keep being China's main rival in Asia for long time to come (both have been rivals for centuries, won't stop anytime soon. Lol). This game is indeed getting very interesting... I like that.

Let the game begin, since Japan has openly let know it won't accept/seat still as China expands its own influence with so called AIIB.

 

[ahojunk]

.
UN official sees no difficult ties between AIIB and other financial institutions
English.news.cn 2015-04-21 09:51:18

UNITED NATIONS, April 20 (Xinhua) -- A senior UN official said Monday that difficult relations do not exist between the Asian Infrastructure Investment Bank (AIIB) and other financial institutions, adding that the Chinese government intends to work closely with them.


"I do not see the kind of difficult relations between AIIB and other financial institutions," Wu Hongbo, UN undersecretary-general for economic and social affairs, told a press conference on financing for development.

"The Chinese government has already said they will work very closely with the World Bank and the Asian Development Bank, (and) that's their intention," he said.

Wu said that one of the important areas in boosting economic recovery is investment in infrastructure and many countries need this investment.

"Take Asia alone, in the next decade, the investment in infrastructure in that region requires 8 trillion dollars," he noted.

"So I would see great benefit and value in having this bank (of AIIB)," he said. "I think the only thing (in need) is trying to remove all these misunderstandings and unfounded worries."

The China-proposed AIIB is expected to be established by the end of this year. It will provide financing for roads, railways, airports and other infrastructure projects in Asia.
.

 

[AndrewJin]

To be honest, there are many other nations we created from Africa to middle east. So you don't have to pick on only India.

Anyway , as I said before Japan won't join and even if it did, it will be the last country to ever do so if ever. The AIIB is a threat to Japan's influence/dominance in Asia more than any other country(yes more than even the mighty U.S). Its not in Japans interest to join, so Japan won't join and will try as much as possible to act as a spoiler. I don't think there's anything wrong in this though, geo politics is not a clean game, any trick is allowed So Japan will keep being China's main rival in Asia for long time to come (both have been rivals for centuries, won't stop anytime soon. Lol). This game is indeed getting very interesting... I like that.

Let the game begin, since Japan has openly let know it won't accept/seat still as China expands its own influence with so called AIIB.

I mean the biggest work.
@Nihonjin1051 will be sad.

 

[mike2000 is back]

I mean the biggest work.
[USEelites/25]@Nihonjin1051[/USER] will be sad.

Well nihonji can be sad, just like every other 'common man' .however, its the elites/leaders that always decide, the common man have little to no say in how things play out.

 

[ahojunk]

.
How China is upsetting the old global economic order
by Aurélia End, Agence France-Presse
Posted at 04/20/2015 8:20 AM

WASHINGTON -- With its huge new infrastructure bank and its ambitions for a globalized renminbi currency, China is leading the upending of a 70-year-old global order built on American economic power.

Beijing's rise was confirmed this week at the Spring meetings of the World Bank and International Monetary Fund in Washington, the two institutions by which the economic vision of the United States has been propagated across the world since their founding in 1944.

The US-selected president of the World Bank, Jim Yong Kim, applauded China's "bold step in the direction of multi-lateralism" for its new Asia Infrastructure Investment Bank, even as many view it as a rival to the Bank.

Kim stressed though that he expects the World Bank and the AIIB will work "very closely" together.

That appeared to pull the World Bank away from its major shareholder: together with ally Japan, Washington has refused to join the AIIB even as nearly five dozen other countries have applied to Beijing to be part.

Beijing moved on the AIIB, which aims to support infrastructure development across the Asia region, as another China-backed project announced in 2014, the BRICS bank, has stalled.

But that institution, planned with fellow emerging economic powers Brazil, Russia, India, and South Africa, was designed as well as a challenge to the World Bank and IMF, where the old powers the US, Europe and Japan dominate.

Threat to World Bank?

Critics fear the new development banks will challenge the World Bank in lending to poorer countries by offering them easier terms and fewer restrictions governing the social and environmental impacts of large projects, undermining standards established to protect vulnerable populations.

The Chinese approach is more pragmatic though, with each institution filling a need, said Christophe Destais of CEPII, the French international economics think tank.

Countries are searching for new opportunities in public works and energy, and also for their banks, he said, the latter possibly explaining why US ally Britain rushed to join the AIIB, he said.

For its part, China is seeking "an outlet for its industrial overcapacity" while at the same time aiming "to weaken US influence," said Destais.

But China is not abandoning the US and Europe-dominated Bretton Woods system of multilateral development banks set up in 1944, however imperfect it is, he said.

"China finds it useful. It has the means to influence it, though still not to shape it," especially since the US dollar remains the world's core currency.

But China's growing power keeps Washington nervous.

Even as new institutions like the AIIB emerge, US Treasury Secretary Jacob Lew said in a statement Saturday: "I would like to underscore that the IMF remains the foremost international institution for promoting global economic stability."

Nobel Prize-winning economist Joseph Stiglitz said the US hostility to the AIIB is a new sign of its insecurity over its global influence.

US shares blame

But Washington is also at fault in the erosion of its Bretton Woods-based power.

The US Congress has refused to ratify crucial reforms at the IMF laid out in 2010 that would double its funding and recognize with higher shareholder quotas the rise of economies such as China and India.

As the IMF's largest shareholder by far, Washington has now blocked the reforms for four years, to great criticism from allies and rivals in the world economy.

"This remains an impediment to IMF credibility, legitimacy and effectiveness," lashed the G-24 group of emerging economies at the IMF-World Bank meetings this week.

The AIIB is not the only front of China's challenge to the old US-centered global economic structure.

After decades of closely controlling its currency, the renminbi or yuan, China is now moving to internationalize it, and asking that it be included in the IMF's benchmark basket of major currencies, known as SDRs, or special drawing rights.

That move, which could happen as early as 2016, would officially elevate the yuan to world status and boost China's prestige inside the IMF.

© 1994-2015 Agence France-Presse
.

 

[WAR-rior]

i somewhat agree with you. any big scale projects that has indian participation is bound to fail. Ie. BRICS bank anyone?

You mean it will fail in India but will be a super duper success in terrorism hit highly uneducated Pakistan? 50 cent proved.

 

[ahojunk]

Commentary: Launch of AIIB promises fast track to common development, win-win cooperation
English.news.cn 2015-04-15 16:55:36

by Xinhua writer Ma Mengli


BEIJING, April 15 (Xinhua) -- Welcoming passengers from around the world, an "Oriental Express" train is getting ready to hit the rails toward a destination of common development and win-win cooperation: the Asian Infrastructure Investment Bank (AIIB).

The number of AIIB's prospective founders was finalized Wednesday, as of which, a total of 57 countries have been approved as the founding members of the China-proposed bank.

The bank has received an increasing number of endorsements in Asia and beyond since it was first proposed by the Chinese government around half a year ago.

Its popularity across the world, even among the U.S. allies, should be attributed to its design as an open and inclusive multilateral lender, which promises win-win interactions in the global arena.

The enthusiasm among Western countries to take a ride on this "Oriental Express" train is also due to the understanding that the bank, aiming to complement rather than compete with the existing global financial institutions, would provide them with lucrative business opportunities.

Factors such as China's rich experience in infrastructure development and the enormous gap in funds needed to break the infrastructure bottleneck in Asia play a role here.

The establishment of the AIIB is an attempt to meet Asia's tremendous infrastructure needs. The Asian Development Bank estimated in 2009 that Asia needs about 8 trillion U.S. dollars in investment by 2020 to improve the region's battered infrastructure to keep its economies humming.

Poverty reduction is not the first priority of the AIIB, which focuses mainly on promoting economic growth. Instead, the fundamental mandate of the bank is to invest in quasi-commercial infrastructure projects so as to promote regional inter-connectivity and mutual access and strengthen the capacity to self-develop.

Meanwhile, the AIIB will uphold high standards as it can learn from the best practices of the existing multilateral financial institutions such as the World Bank and the Asian Development Bank, which have accumulated many good experiences and practices with regards to governance structure, environmental evaluation, procurement, debt sustainability and project management.

The AIIB will uphold high standards and abide by stringent policies to avoid repeating past mistakes, reduce operation costs and increase efficiency.

The World Bank welcomes the AIIB with open arms, pledging to "bring all of its 70 years of experience to helping the bank figuring out what it wants to do."

As a matter of fact, the World Bank has already started cooperation with the AIIB in such areas as institutional standards and framework formulation.

Jin Liqun, secretary general of the interim multilateral secretariat of the China-proposed institution, has said that China and all the members of the AIIB will be committed to building a bank which would be "lean, clean and green."

The cost-effective and highly streamlined institution will have a zero-tolerance policy on corruption and be dedicated to promoting a green and low-carbon economy.

Editor: Song Miou

 

[ahojunk]

21 April 2015, 8.25pm AEST
China’s AIIB helps resolve Asia’s soaring infrastructure needs

About 1.8 billion people in Asia lack basic sanitation services, like this slum in Jakarta, Indonesia.

Less than two years after reports first appeared in October 2013 about the formation of a new specialized development bank focused on Asia, China’s Asian Infrastructure Investment Bank (AIIB) has become a reality.

While its birth has given rise to international tensions, it has also offered hope to developing countries that need an enormous amount of infrastructure investment in coming years.

The tensions – the US has fiercely opposed China’s bank and lobbied its allies not to join it – have been well reported and discussed. Overlooked by these critics is that the region’s investment needs are far too great to be met by the West’s development banks alone. China’s willingness to shoulder more of the burden should be welcomed, and the decision of US allies like the UK and Germany to become founding members gives the AIIB a significant credibility boost that will make it more likely to succeed.

Top priority: financing infrastructure
A few years ago the Asian Development Bank Institute, where I have been an adviser, contributed to a report pointing out correctly that Asia will require at least US$8 trillion to invest in infrastructure from 2010 to 2020 for the region to continue economic development at a reasonable pace.

The kinds of infrastructure needed range from the high-tech such as telecommunications services and high-speed railroads to the most basic and essential. About 1.8 billion are not connected to basic sanitation services, 800 million lack electricity and 600 million do not have access to potable water, according to the report.

For those of us who have been involved in strategy debates over Asian development since the 1980s, Japan, Korea, Taiwan and now China itself are all existing examples of the extent to which infrastructure investment is instrumental in economic development.

In my many visits to East Asia – most recently China – I have seen how national and international linkages can be constructed through infrastructure investment. China itself exemplifies how investing in roads and education can make a dramatic impact on a country’s long-term growth and lifting millions of people out of poverty.

Financing such investment is, therefore, a top strategic priority. The International Monetary Fund, the Asia Development Bank and the World Bank have all played pivotal roles helping finance such investment in these now prosperous countries.

The availability of transport, electricity, schools and hospitals has a “tremendous impact on improving the quality of life,” while businesses need more reliable infrastructure to spur growth, which boosts incomes and reduces poverty, according to the ADB report.

The addition of the AIIB to the fold would bring many benefits especially to those parts of Asia in the Southeast and South Asian regions that lag behind in infrastructure investment. Indonesia has the greatest needs, with the ADB estimating $450 billion will be required through 2020, mostly on transport. China needs just a little less, primarily due to electricity troubles, while another seven countries require at least $100 billion a piece.

In addition, the problem of a global lack of demand for goods and services due to the slowing economy will be mitigated by the hundreds of billions of dollars in extra infrastructure spending in Asia. Thus there are both local and global benefits that can be reaped from appropriate infrastructure investment projects financed by the AIIB.

AIIB’s rapid growth
In pushing the AIIB against the wishes of the US, the Chinese capitalized on a growing impatience among many Asian policy makers over the unwillingness of global institutions like the IMF and World Bank to allow greater input into its operations.

Last April Chinese Premier Li Keqiang said China was ready to intensify consultations with those interested in joining the AIIB. By June China proposed doubling the registered capital of the bank from $50 billion to $100 billion and invited India to participate in its founding. Just four months later, a signing ceremony held in Beijing formally established the bank, with 21 initial signatories, including Thailand, Singapore and Vietnam.

Since then the number of countries agreeing to sign on as founders has soared, such as Hong Kong in February, to 57.

But the AIIB’s credibility was particularly enhanced when in early March UK Chancellor of the Exchequer George Osborne announced that Britain had agreed to lend money to the Bank, becoming the first major Western country to do so in spite of US opposition. Soon on the heels of UK, three other European nations – Germany, France and Italy – followed suit.

Clearly, the concept of AIIB has become institutionally viable. It has also established the credibility of China’s economic diplomacy.

Competitive pluralism
Thoughtful economists should welcome this multilateral initiative led by China. In line with other southern initiatives such as the launch of the New Development Bank last July by the so-called BRICS (Brazil, Russia, India, China and South Africa), the AIIB will ease emerging countries' strategic financing problems for development. It will also lead to a healthy competitive pluralism in this area that the Asian Development Bank itself has defended in the past.

The time has come for the experts to offer serious analyses of specific projects and their costs and benefits for the region. Here in addition to growth and employment aspects, social and environmental issues can also be analyzed in a multilateral context.

The AIIB offers a great opportunity to craft new strategies and foster fresh frameworks for making serious investments in infrastructure in Asia. Indeed, this is the key challenge that development strategists must address as the AIIB takes shape and aims to make a meaningful contribution the region’s growth.
.

 

[ahojunk]

Report from Indian media. They are hoping for an Indian to be Vice President of AIIB.
Good luck!

------------------------------------------------------
Indian likely to get VP's post in China floated AIIB
By PTI | 22 Apr, 2015, 06.14PM IST

BEIJING: An Indian is likely to get the vice president's post in China-backed Asia Infrastructure Investment Bank (AIIB) in which India and 56 countries have been admitted as founding members.

Chief negotiators of the countries would hold a key meeting next week to begin consultations to finalise the format of the AIIB's functioning, including the voting share.

The MOU of the bank to be headquartered in Beijing specifies that the authorised capital of AIIB will be USD 100 billion with an initial subscribed capital of USD 50 billion.

The bank being headed by China is headquartered in Beijing.

Chances of India getting the Vice President's post are high as the vote share is expected to be based on 50 per cent Gross Domestic Product ( GDP) and 50 per cent Purchasing Power Parity (PPP) with primacy to be given to the Asian countries as the bank primarily aims to fund infrastructure projects mainly in the Asian region, officials told PTI.

Under these guidelines, India figured next to China and is expected to take the lead role, they said.

India has already been designated to head the BRICS, (Brazil, Russia, India, China, South Africa) Development Bank which will be headquartered in Shanghai.

It will have a starting capital of USD 50 billion. Besides AIIB and BRICS Bank, China has announced USD 40 billion special fund for its Silk Road projects to develop a wide network of highways, railway and ports in Asia and Africa.

The overall format of AIIB is expected to be finalised after a series of meetings in which India is taking part.

Chinese officials stated that the bank will draw best practices from the IMF, World Bank and ADB but will avoid domination of few countries setting rules for the international financial system.

As a new multilateral institution focusing exclusively on infrastructure development, the AIIB will be dominated by developing countries, and their requests and demands need to be respected, China's vice finance minister Zhu Guangyao said.

The establishment of the AIIB is an attempt to help fill Asia's infrastructure investment gap and promote economic development in the region, he has been quoted by the official media here as saying.

The Asian Development Bank (ADB) estimated in 2009 that Asia needs about USD 8 trillion investment by 2020 to improve the region's battered infrastructure to keep its economies humming.

Representatives of the 57 founding countries, which were finalised will deliberate in the next two months on the AIIB's charter, of which management structure will be the most important part.

The US and Japan have refrained from joining while a number of their European allies like Britain, Australia, Germany and France joined the bank as founding members, taking Washington by surprise.

China has said the AIIB will draw experiences from other multilateral development banks and avoid their detours so as to be more cost-effective and efficient.

The new bank will feature a three-level management structure that includes a board of governors, board of directors and senior management, according to the Chinese Finance Ministry.

Zhu said that there were debates about whether or not the AIIB should have a resident board of directors commonly adopted by the World Bank and the ADB.

The intention of these debates is to "increase efficiency and improve the capacity" of the bank to better serve the clients, but it will be finally decided by coming negotiations among founding members, he said.

Officials said it is a good idea to have a non-resident board of directors for the AIIB, as it would help make a clear distinction between the board and the management, and also have great accountability.

Countries that have been accepted as founding members of the AIIB include China, India, Malaysia, Indonesia, Singapore, Thailand, Kazakhstan, Saudi Arabia, Kuwait, Oman, Qatar, Brunei, Cambodia, Laos, Myanmar, the Philippines, Vietnam, Mongolia, Uzbekistan, Nepal, Sri Lanka, Bangladesh, Pakistan, the Maldives, New Zealand, Jordan, Tajikistan, Luxemburg, Switzerland, Britain, Australia, Austria, Brazil, Denmark, France, Germany, Italy, Netherlands and Spain.
.

 

[AndrewJin]

Report from Indian media. They are hoping for an Indian to be Vice President of AIIB.
Good luck!

------------------------------------------------------
Indian likely to get VP's post in China floated AIIB
By PTI | 22 Apr, 2015, 06.14PM IST

BEIJING: An Indian is likely to get the vice president's post in China-backed Asia Infrastructure Investment Bank (AIIB) in which India and 56 countries have been admitted as founding members.

Chief negotiators of the countries would hold a key meeting next week to begin consultations to finalise the format of the AIIB's functioning, including the voting share.

The MOU of the bank to be headquartered in Beijing specifies that the authorised capital of AIIB will be USD 100 billion with an initial subscribed capital of USD 50 billion.

The bank being headed by China is headquartered in Beijing.

Chances of India getting the Vice President's post are high as the vote share is expected to be based on 50 per cent Gross Domestic Product ( GDP) and 50 per cent Purchasing Power Parity (PPP) with primacy to be given to the Asian countries as the bank primarily aims to fund infrastructure projects mainly in the Asian region, officials told PTI.

Under these guidelines, India figured next to China and is expected to take the lead role, they said.

India has already been designated to head the BRICS, (Brazil, Russia, India, China, South Africa) Development Bank which will be headquartered in Shanghai.

It will have a starting capital of USD 50 billion. Besides AIIB and BRICS Bank, China has announced USD 40 billion special fund for its Silk Road projects to develop a wide network of highways, railway and ports in Asia and Africa.

The overall format of AIIB is expected to be finalised after a series of meetings in which India is taking part.

Chinese officials stated that the bank will draw best practices from the IMF, World Bank and ADB but will avoid domination of few countries setting rules for the international financial system.

As a new multilateral institution focusing exclusively on infrastructure development, the AIIB will be dominated by developing countries, and their requests and demands need to be respected, China's vice finance minister Zhu Guangyao said.

The establishment of the AIIB is an attempt to help fill Asia's infrastructure investment gap and promote economic development in the region, he has been quoted by the official media here as saying.

The Asian Development Bank (ADB) estimated in 2009 that Asia needs about USD 8 trillion investment by 2020 to improve the region's battered infrastructure to keep its economies humming.

Representatives of the 57 founding countries, which were finalised will deliberate in the next two months on the AIIB's charter, of which management structure will be the most important part.

The US and Japan have refrained from joining while a number of their European allies like Britain, Australia, Germany and France joined the bank as founding members, taking Washington by surprise.

China has said the AIIB will draw experiences from other multilateral development banks and avoid their detours so as to be more cost-effective and efficient.

The new bank will feature a three-level management structure that includes a board of governors, board of directors and senior management, according to the Chinese Finance Ministry.

Zhu said that there were debates about whether or not the AIIB should have a resident board of directors commonly adopted by the World Bank and the ADB.

The intention of these debates is to "increase efficiency and improve the capacity" of the bank to better serve the clients, but it will be finally decided by coming negotiations among founding members, he said.

Officials said it is a good idea to have a non-resident board of directors for the AIIB, as it would help make a clear distinction between the board and the management, and also have great accountability.

Countries that have been accepted as founding members of the AIIB include China, India, Malaysia, Indonesia, Singapore, Thailand, Kazakhstan, Saudi Arabia, Kuwait, Oman, Qatar, Brunei, Cambodia, Laos, Myanmar, the Philippines, Vietnam, Mongolia, Uzbekistan, Nepal, Sri Lanka, Bangladesh, Pakistan, the Maldives, New Zealand, Jordan, Tajikistan, Luxemburg, Switzerland, Britain, Australia, Austria, Brazil, Denmark, France, Germany, Italy, Netherlands and Spain.
.










..

I think Indian members here are more for 100% PPP. LOL