AIIB (Asian Infrastructure Investment Bank) news

[JSCh]

AIIB outlines 5 core areas for investment
China Daily, 2015-12-04 10:15

The China-led Asian Infrastructure Investment Bank will invest in five major areas during its initial stages－energy, transportation, rural development, urban development and logistics－a top official said on Thursday.

The bank will later expand the investment to other areas such as education and healthcare to promote social development, said Chen Huan, chief officer of the Multilateral Interim Secretariat of AIIB, during the 6th China-South Korea Banking Development Forum in Shanghai.

The scale of project investment and bond issuance will not be huge at first. The bank is planning to issue bonds worth $100 million to $500 million in the first year of operation and is still waiting for approval by the board of directors. It is likely to issue nonrated bonds at the beginning.

Chen told the forum that AIIB is expected to meet the requirements for operation by the end of this month. Twelve of the 57 founding members have approved the bank's charter so far and they account for more than 40 percent of the total capital. India and Russia are likely to approve the charter by the middle of this month.

The mission of the AIIB is to mobilize social capital. The size of investment for an infrastructure project is so huge that the bank has to share the risk with others, he said.

"The policy framework and investment environment is fairly poor in underdeveloped countries and needs improvement. That's why it is necessary to set up an international financial institution like the AIIB. We will go to these countries first to handle the risk and solve the problems associated with government policies, thus guiding commercial banks to participate in the region's infrastructure projects," he said.

Cao Honghui, vice-president of the research institute at China Development Bank Corp, who played an active role in the preparation of the AIIB, said loans will be the major form of investment. However, the lender will not rule out the possibility of setting up investment funds or providing guarantee services and equity investment services at a later date.

Suh Jae-hong, director general for international cooperation of the Financial Services Commission, South Korea's top financial regulator, said it is hard to assess the risk and profitability of infrastructure projects in Asia's emerging markets. Therefore, the Chinese and South Korean banks need to build a strategic cooperative partnership.

Last month, Premier Li Keqiang proposed the establishment of an Asian financial cooperation association at the 18th ASEAN Plus Three Summit in Kuala Lumpur.

Yang Zaiping, executive vice-president of the China Banking Association, told the forum on Thursday that the CBA is authorized to lead preparations for the founding of the Asian financial cooperation association, in the hope that Asia will have a bigger say and greater influence in global finance.

 

[Echo_419]

AIIB to lend up to US$15b every year, says top official
December 2, 2015

Jin Liqun, president-designate of the Asian Infrastructure Investment Bank.[Provided to China Daily]


The Asian Infrastructure Investment Bank, the new international development bank led by China, plans to lend $10 billion to $15 billion a year for the first five or six years, a top official said on Tuesday.

The new lender, which will be inaugurated later this month, plans to conduct its first board meeting next month and will support infrastructure development and connectivity in Asia, said Jin Liqun, the president-designate of the AIIB.

"The bank is neither a Chinese bank nor a bank owned by the Chinese government, but one owned by all participating countries," said Jin in Beijing on Tuesday.

Jin did not specify any priority projects for the AIIB or the countries that would be the beneficiaries of initial loans, but said around 30 countries are waiting in line for membership and this would increase the bank's capital.

"There are 50 applicants in the fray for the position of deputy head of the AIIB," said Jin, the former chairman of investment bank China International Capital Corp.

Urging European experts to join the lender, Jin said their services are necessary for the AIIB during the growth phase. Going forward, the AIIB will look to jointly fund infrastructure projects in Europe.

"The AIIB should not be limited to Asian countries, and it can only succeed if European and countries from other continents join," said Jin.

Jin, however, said that the idea of having more members is not because Asia is not up to the job, but rather the emphasis that developed countries, particularly European countries, could share their experiences in running international institutions.

"It is crazy to reject any other countries in the world and not to seek advice in running the bank, and for European countries, joining the AIIB is an opportunity to do different things and do things differently," Jin said.

The United Kingdom applied to join the AIIB as a founding member in March, and this has prompted more European countries to follow suit, he said.

Suma Chakrabarti, president of the European Bank for Reconstruction and Development, said earlier that the AIIB has important implications for EBRD as the combined strength of the two could allow them to take on much larger projects.

EBRD said it is keenly eyeing opportunities to work closely with the AIIB.

According to Jin, the US dollar would be the operating currency of the AIIB for its convenience while the bank would also take into consideration financing requests in other currencies, including the yuan.

In response to doubts and skepticism about the creation of the AIIB and whether it will compete with existing institutions, Jin said each phase of development should have a new type of modern institution to meet the needs of that time, citing examples like the Asian Development Bank set up half a century ago.

Allaying concerns and the harsh, sometimes hostile comments on what China needs to do and whether it was necessary to set up the AIIB, Jin said there is no doubt that Asia's infrastructure development will take off in the next 15 to 20 years.

"It's important to explore the possibilities of a new type of bank and a new approach to deal with the emerging economic and social development issues, as the backlog in Asia's infrastructure development has contributed to a bottleneck in social development, climate change and other serious problems," he said.

The bank has already initiated talks with other institutions, including the ADB and the World Bank, said Jin.

Cyril Muller, former director for banking and debt management in the World Bank Treasury, said in March during the Boao Forum for 2015 Asia Annual Conference that AIIB could learn from previous experience and cooperate with existing organizations.

Brilliant news

 

[TaiShang]

Brilliant news

So, there seems to be five areas to invest, as @JSCh 's post mentions. These areas clearly reflect the "development" basis of the AIIB.

I wonder who will be the first beneficiaries of the loans and which projects.

Very constructive development.

 

[Echo_419]

So, there seems to be five areas to invest, as @JSCh 's post mentions. These areas clearly reflect the "development" basis of the AIIB.

I wonder who will be the first beneficiaries of the loans and which projects.

Very constructive development.

I hope that the people in charge of issuing loans are not biased.Having said that,I think we will be able to secure a major portion of upcoming loams

 

[JSCh]

UK says first in G7 to ratify China-backed development bank
LONDON, Thu Dec 3, 2015 3:00pm GMT

Britain said it had become the first Group of Seven economy to sign off on the rules of a China-backed development bank for Asia, which is seen by the United States as an unwelcome rival to Western-led institutions such as the World Bank.

"This caps a tremendous year for the UK's economic relations with Asia, the fastest growing region of the world economy," British Chancellor George Osborne said in a statement issued on Thursday.

Britain was the first non-Asian country as well as the first from the G7 to ratify the Asian Infrastructure Investment Bank's articles of agreement, he said.

Britain was the first Western nation to join the AIIB earlier this year, prompting other countries to sign up, despite Washington's concerns.

The British government has prioritised developing economic ties with China and welcomed Chinese President Xi Jinping on a state visit in October. But domestic critics said it was placing short-term financial gains above human rights and Britain's longer-term security interests.

The AIIB was launched in Beijing last year to spur transportation, energy, telecommunication and other investment. The United States has previously expressed concerns about whether the AIIB would have sufficiently high standards on governance and environmental and social safeguards.

(Reporting by William Schomberg; Editing by Toby Chopra)

UK says first in G7 to ratify China-backed development bank | Reuters

 

[JSCh]

AIIB to invest heavily in infrastructure to interconnect Asia chinadaily.com.cn 2015-12-16 16:35

Jin Liqun, the president-designate of the AIIB,addresses the the Second World Internet Conference in Wuzhen, East China's Zhejiang province on Wednesday.​

The China-led Asian Infrastructure Investment Bank (AIIB) will invest heavily in infrastructure projects that would help make Asia an interconnected region, Jin Liqun, the president-designate of the AIIB, said Wednesday.

The bank will be officially up and running by the end of this year and its first board meeting will be held in mid Jan, Jin said at the ongoing Second World Internet Conference in Wuzhen, East China's Zhejiang province.

"That marks the first step for the Asian Infrastructure Investment Bank to contribute to the construction of infrastructure facilities that would help build Asia into an interconnected region, including construction of the Internet," Jin said.

The bank will support an international Internet governance system that is multinational, democratic and transparent, according to Jin.

It will also make good use of Internet technologies in selecting infrastructure projects.

"AIIB is committed to using big data to predict all countries' demand for infrastructure and better cater to their needs," said Jin, adding that the bank will invest heavily in the infrastructure projects that would boost connectivity in Asia.

He lauded the role of the Internet in helping develop traditional industries.

The Internet is an important infrastructure to facilitate regional interconnectivity and push forward industrial innovation and integration. The Internet-oriented new economy will activate the traditional economy. Though the traditional industry and infrastructure are indispensable, they can not play their due role without the Internet, Jin said.

Currently the AIIB has 57 prospective founding countries and will have an authorized capital of $100 billion. At the end of June, finance ministers of the founding members gathered in Beijing to sign the AIIB agreement.

 

[TaiShang]

AIIB Wins Trust before Opening: AIIB President-Designate
2015-12-17

File photo of Jin Liqun, the president-designate of the Asian Infrastructure Investment Bank. [Photo: p-along.com]

The president-designate of the Asian Infrastructure Investment Bank says the lender has earned trust on the international scene.

Jin Liqun made the remarks at the ongoing World Internet Conference, days ahead of the official opening of the new bank.

"When China launched this bank, everyone was concerned that it would be a target that others would attack us. But after two years' preparation, the doubt has been dispelled, because we take other countries' advice and discuss issues based on democracy in the preparation work. We do not boss around, and so we win the trust of others."

He says the bank will be a lean and clean organization, as digital technology will be used in setting up its structure, helping to prevent corruption.

The bank has also taken measures to prevent illegal activities launched by terrorists and lawbreakers.

Currently the AIIB has 57 prospective founding countries and will have an authorized capital of 100 billion USD.

It will be officially up and running by the end of this year and its first board meeting will be held in mid-January.

 

[JSCh]

Germany becomes AIIB's largest non-regional shareholder
By Yu Xiaoming(chinadaily.com.cn)
Updated: 2015-12-21 16:30:45

Delegates from 57 member countries attend a signing ceremony of articles of agreement of the Asian Infrastructure Investment Bank (AIIB), at the Great Hall of the People in Beijing, June 29, 2015.[Photo/Agencies]​

Germany, as one of the first partners of the Asian Infrastructure Investment Bank (AIIB), has deposited its instrument of ratification of the bank at the Ministry of Foreign Affairs of China, the German embassy in China said on Monday.

Contributing $4.5 billion, Germany will be the fourth largest capital provider for the AIIB globally and the largest one non-regionally.

Germany will partner with the AIIB closely and attentively concerning the fulfillment of its mandate and tasks, which includes compliance with international standards, the embassy said in a statement.

The executive director from Germany at the AIIB will be based in Beijing, added the embassy.

The AIIB, the new international development bank led by China, currently has 57 prospective founding countries.

With authorized capital of $100 billion, the AIIB will invest in sectors including energy, transportation, urban construction and logistics as well as education and healthcare.

The new lender, which will be inaugurated at the end of this year, plans to lend $10 billion to $15 billion a year for the first five or six years, Jin Liqun, the president-designate of the AIIB, said earlier this month.

 

[TaiShang]

Germany becomes AIIB's largest non-regional shareholder
By Yu Xiaoming(chinadaily.com.cn)
Updated: 2015-12-21 16:30:45

Delegates from 57 member countries attend a signing ceremony of articles of agreement of the Asian Infrastructure Investment Bank (AIIB), at the Great Hall of the People in Beijing, June 29, 2015.[Photo/Agencies]​

Germany, as one of the first partners of the Asian Infrastructure Investment Bank (AIIB), has deposited its instrument of ratification of the bank at the Ministry of Foreign Affairs of China, the German embassy in China said on Monday.

Contributing $4.5 billion, Germany will be the fourth largest capital provider for the AIIB globally and the largest one non-regionally.

Germany will partner with the AIIB closely and attentively concerning the fulfillment of its mandate and tasks, which includes compliance with international standards, the embassy said in a statement.

The executive director from Germany at the AIIB will be based in Beijing, added the embassy.

The AIIB, the new international development bank led by China, currently has 57 prospective founding countries.

With authorized capital of $100 billion, the AIIB will invest in sectors including energy, transportation, urban construction and logistics as well as education and healthcare.

The new lender, which will be inaugurated at the end of this year, plans to lend $10 billion to $15 billion a year for the first five or six years, Jin Liqun, the president-designate of the AIIB, said earlier this month.

？？

I thought UK was to be the largest non-regional shareholder.

@mike2000 is back

 

[mike2000 is back]

？？

I thought UK was to be the largest non-regional shareholder.

@mike2000 is back

Not really. As far as i know, shares are allocated according to the amount of capital each country allocates to the Bank.
In this regard German has 4.57% shares and 4.15% voting rights Australia has, 3.76% of shares and 3.46% voting rights France has 3.44% shares and 3.19% voting rights. Britain has just 3.11%shares and 2.91% voting rights which is lower than all of the above mentioned Western powers.
You have to note that the U.K was the first major western country(which made all other western countries to follow our lead) to join simply because we wanted to make sure London will be the main trading point of Reminmbi outside Asia/Hong Kong, thus maintaining London's position as the worlds leading global financial center.Which we finally got.
So our Joining was more of symbolic gesture and to strengthen our trade/business/investment relationship.

 

[TaiShang]

AIIB formally established in Beijing
December 25, 2015

The China-initiated Asian Infrastructure Investment Bank (AIIB), a complement to existing international financial system, was formally established Friday in Beijing and expected to start operation early next year.

"The AIIB is legally established as the Articles of Agreement take effect today," said Lou Jiwei, China's Minister of Finance.

The Articles of Agreement outlines the financial share of each founding member as well as rules for policymaking, governance structure, and business and operational systems for the bank. It became effective once the legislatures of 17 members, who hold a combined 50.1 percent stake in the bank, ratified the agreement.

As long as at least 10 signatories, and no less than 50 percent of the capital contribution, obtain legislative approval, the agreement will become effective.

The establishment of the AIIB marks a milestone in the reform of global economic governance system, Lou said.

The AIIB will be operational after board of directors and executive council meet for the first time. The meetings are slated to run from Jan. 16 to 18 in Beijing, according to Lou. The bank's president will be officially appointed and the management team will be in place at the meetings.

The bank will start recruiting new members, Jin Liqun, the bank's president-designate, said in an interview with Xinhua, adding that members of the International Bank for Reconstruction and Development and the Asian Development Bank (ADB) could apply to join the AIIB.

The bank will always be open to new membership, Jin said.

The bank, headquartered in Beijing, now has 57 members.

China, India and Russia are the three largest shareholders, taking a 30.34 percent, 8.52 percent, 6.66 percent stake, respectively. Their voting shares are calculated at 26.06 percent, 7.5 percent and 5.92 percent.

"China is not deliberately seeking a veto power," its stake and voting share in the initial stage are the "natural outcome" of current rules, and may be diluted as more members join, China's Vice Finance Minister Shi Yaobin said in an interview with Xinhua.

As its name suggests, the AIIB will finance infrastructure -- airports, mobile phone towers, railways and roads -- in Asia.

There is a yawning infrastructure funding gap in Asia. The ADB pegged the hole with about 8 trillion U.S. dollars between 2010 and 2020.

While both the ADB and World Bank focus on a broad range of development programs including agriculture, education and gender equality, the AIIB will concentrate on infrastructure alone. The International Monetary Fund, World Bank and ADB have all welcomed the AIIB initiative and see room for collaboration.

With authorized capital of 100 billion dollars, the AIIB will initially prioritize investment in energy, power generation, transportation, rural infrastructure, environmental protection and logistics. It is expected to offer loans to the first batch of projects in mid-2016.

 

[ahojunk]

AIIB formally established in Beijing
December 25, 2015

The China-initiated Asian Infrastructure Investment Bank (AIIB), a complement to existing international financial system, was formally established Friday in Beijing and expected to start operation early next year.

"The AIIB is legally established as the Articles of Agreement take effect today," said Lou Jiwei, China's Minister of Finance.

The Articles of Agreement outlines the financial share of each founding member as well as rules for policymaking, governance structure, and business and operational systems for the bank. It became effective once the legislatures of 17 members, who hold a combined 50.1 percent stake in the bank, ratified the agreement.

As long as at least 10 signatories, and no less than 50 percent of the capital contribution, obtain legislative approval, the agreement will become effective.

The establishment of the AIIB marks a milestone in the reform of global economic governance system, Lou said.

The AIIB will be operational after board of directors and executive council meet for the first time. The meetings are slated to run from Jan. 16 to 18 in Beijing, according to Lou. The bank's president will be officially appointed and the management team will be in place at the meetings.

The bank will start recruiting new members, Jin Liqun, the bank's president-designate, said in an interview with Xinhua, adding that members of the International Bank for Reconstruction and Development and the Asian Development Bank (ADB) could apply to join the AIIB.

The bank will always be open to new membership, Jin said.

The bank, headquartered in Beijing, now has 57 members.

China, India and Russia are the three largest shareholders, taking a 30.34 percent, 8.52 percent, 6.66 percent stake, respectively. Their voting shares are calculated at 26.06 percent, 7.5 percent and 5.92 percent.

"China is not deliberately seeking a veto power," its stake and voting share in the initial stage are the "natural outcome" of current rules, and may be diluted as more members join, China's Vice Finance Minister Shi Yaobin said in an interview with Xinhua.

As its name suggests, the AIIB will finance infrastructure -- airports, mobile phone towers, railways and roads -- in Asia.

There is a yawning infrastructure funding gap in Asia. The ADB pegged the hole with about 8 trillion U.S. dollars between 2010 and 2020.

While both the ADB and World Bank focus on a broad range of development programs including agriculture, education and gender equality, the AIIB will concentrate on infrastructure alone. The International Monetary Fund, World Bank and ADB have all welcomed the AIIB initiative and see room for collaboration.

With authorized capital of 100 billion dollars, the AIIB will initially prioritize investment in energy, power generation, transportation, rural infrastructure, environmental protection and logistics. It is expected to offer loans to the first batch of projects in mid-2016.

.
This is indeed good news.

More so coming on an auspicious day - Christmas Day!

All the best to the AIIB.

Maybe the next new bank will give more focus to Africa once the AIIB is established and up and running.

Africa needs infrastructure.

 

[TaiShang]

.
This is indeed good news.

More so coming on an auspicious day - Christmas Day!

All the best to the AIIB.

Maybe the next new bank will give more focus to Africa once the AIIB is established and up and running.

Africa needs infrastructure.

Maybe the Silk Road Fund can function like the AIIB and, Africa being one of the routes, provide funds to African nations. In the long run, it is a good investment.

But China needs to be extra cautious, especially in North Africa, because the moment ISIS and the likes kicked out of Syria, they will show up en masse across Africa. The trend is already began as Russia pounds them like there is no tomorrow; they are moving to Libya, Mali and all other terrorist havens created single-handedly by the NATO.

 

[JSCh]

AIIB's launch a milestone in global governance reform, to bridge Asia's infrastructure gap

• Xinhua
• 2015-12-27 08:58

The China-initiated Asian Infrastructure Investment Bank (AIIB) was formally established Friday, marking a milestone in the reform of the global economic governance system as well as in the infrastructure development in the Asia-Pacific region.

Tasked with financing infrastructure construction across Asia, it took just two years for the bank to develop from an idea on paper to a fully-fledged body with 57 developed and developing nations as prospective founding members.

Analysts believed the major message behind the AIIB's rapid development is that the establishment of the bank, which upholds high standards and abides by strict regulations, is in line with the best interests of various parties.

Executive Deputy Director-General Zhou Qiangwu of the Asia-Pacific Finance and Development Center -- a think tank funded by the Chinese Ministry of Finance -- said the rapid and good progress the AIIB has made is partly attributed to China's growing national strength and rising global influence.

"On the other hand, it also shows that the government's goal of building the AIIB into an open, transparent and highly-efficient multilateral institution as well as the high standards it is upholding have garnered extensive recognition and strong support across the world," Zhou said.


"It is in line with the best interests, and meets the practical needs of various parties," Zhou added.

Chinese officials have earlier stressed on many occasions that the bank will employ international, normative and high standards in its governance structure, operational policies and human resource management to avoid repeating past mistakes and ensure sound progress in a professional and efficient operation.

The AIIB's establishment was regarded by many analysts as "a milestone event."

The existing global economic governance system has failed to reflect the status quo of the world economy, said Zhou, adding that it has also failed to safeguard the rights and interests the developing countries, including China, deserve, said Zhou.

"The formal launch of the AIIB, which is a late starter in the regional multilateral development institutions, will help accelerate reform of the global economic governance system," Zhou said.

Actually, the "catfish effect" brought about by the establishment of the AIIB has already emerged around the world.

Last week, U.S. Congress approved long-stalled reforms of the International Monetary Fund that will give greater voice to emerging-market countries.

With the rise of the AIIB, the Asian Development Bank (ADB) has also speeded up its paces in financial reforms so as to increase its lending capacity by more efficiently and effectively utilizing its existing resources.

At the 48th ADB Annual Meeting in May, ADB President Takehiko Nakao stressed the need to accelerate reforms and enhance the bank's lending capacity so as to ensure the bank could continue to play a constructive role.

"Now, the AIIB has already become a platform to improve global financial governance system," said Zhang Jianping, director of the International Economic Cooperation Institute of the National Development and Reform Commission.

Meanwhile, the AIIB's establishment will also boost the strength of multilateral development organizations and promote infrastructure development and economic growth in the Asia-Pacific region.

The ADB's 2010 report on the infrastructure needs of 21 Asian economies estimated Asia's infrastructure gap at around 8 trillion U.S. dollars over the period 2010-2020.

"The AIIB will greatly boost infrastructure investment from multilateral development institutions in developing countries and emerging economies, thus promoting their economic growth," Zhou said.

However, analysts also pointed out that the AIIB, while injecting fresh impetus into the global economic governance system and economic development of the Asia-Pacific region, is also faced with many challenges, such as how to keep balance between quality and efficiency.

But Zhou believed the AIIB "will not sacrifice high standards for the needs to develop regional economy."

"Instead, the AIIB will steadily make headway and gradually enhance its lending capacity," Zhou added.

 

[JSCh]

Philippines to join AIIB
2015-12-30 15:48:54

MANILA, Dec. 30 (Xinhua) -- Philippine President Benigno S. Aquino III has approved the country's participation in the China-initiated Asian Infrastructure Investment Bank (AIIB), senior government officials said Wednesday.


Presidential Communications Operations Office Secretary Herminio Coloma Jr. said Aquino gave his go-ahead signal following the recommendation of Finance Secretary Cesar Purisima.

In a separate statement, Purisima said the Philippines will be signing the Articles of Agreement (AOA) of the AIIB before year-end.

The government believes that the AIIB will augment and complement existing multilateral institutions in accelerating economic growth, he said.

"Our shared pursuit of growth and development has only become more challenging as the global environment becomes increasingly complex. We thus welcome platforms where countries can work towards shared development goals in the spirit of partnership," Purisima said.

In a globalized world, connectivity is the name of the game. The AIIB is a "promising institution" addressing investment needs, and will help close financing gaps in many countries, he said.

"I also see this as a chance for greater collaboration with member countries, especially with ASEAN, on regional infrastructure goals," he added.

The Asian Development Bank has estimated Philippine infrastructure financing needs from 2010 through 2020 to be at 127.12 billion U.S. dollars, requiring an annual investment of 11.56 billion U.S. dollars.

The total capital stock of the AIIB is 100 billion U.S. dollars, 20 percent of which is paid-in. The indicative paid-in capital of the Philippines is 196 million U.S. dollars (payable in five years or 39 million U.S. dollars per annum).

"The Philippines has taken the matter of our membership in AIIB very seriously," Purisima said, adding, "We are confident that the Bank's organization design and oversight mechanisms are committed to transparency, independence, openness, and accountability."

"We are likewise optimistic that AIIB's decision-making processes are geared towards making it a lean, clean, green institution run like a true multilateral."

Full powers to sign the AOA on behalf of the Philippines were granted by Aquino to Purisima, or in his absence, Philippine Ambassador to the People's Republic of China Erlina F. Basilio.

"The Philippines stands to gain from signing on as a Founding Member. We can look forward to deepening our country's technical expertise in infrastructure as we expand bankable projects.

"Further, as the AIIB has no restriction on the procurement of goods and services from any country, we may foresee market expansion for infrastructure-related industries, widening job and business growth opportunities," Purisima added.

The opening ceremony and inaugural meeting of the Board of Governors and the Board of Directors in Beijing will take place on the third week of January 2016. Members have until December 2016 to complete domestic ratification and other approval processes, as well as to pay the initial tranche of the corresponding paid-in capital.

Editor: xuxin​