Edison Chen
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China applies to join EBRD, board likely to recommend approval| Reuters
http://www.ft.com/intl/cms/s/0/b34d5a78-7994-11e5-933d-efcdc3c11c89.html
China has made a formal request to become a member of the European Bank for Reconstruction and Development, a move that, if completed, would add to ever-closer ties between Europe and the world’s second-biggest economy.
EBRD membership would also open new channels for Chinese funding of infrastructure and other investments along its new Silk Road or “One Belt, One Road” project, linking China to markets in Europe and the rest of the world.
The application was confirmed by the bank as Xi Jinping, China’s president, ended a four-day visit to the UK last week that included promises of trade and investment deals worth tens of billions of pounds. Mr Xi and David Cameron, the UK prime minister, are understood to have touched on the issue of stronger ties between China and the EBRD during the visit, a possibility that would be welcomed in London.
An EBRD official said “a senior Chinese authority” — understood to be Zhou Xiaochuan, governor of the People’s Bank of China — had written to Sir Suma Chakrabarti, EBRD president, in August, proposing that China become a shareholder in the bank. Another person familiar with the matter said China would not become a country of operations for the EBRD and its shareholding would be a symbolic amount, “just to let them say they are a shareholder”.
Nobody at the Chinese embassy in London was immediately available for comment. The EBRD official said the request would be put before the bank’s existing shareholders — a group of 64 advanced and developing nations — for consideration and that the process was in its “early days”.
“We do try to attract Chinese investments,” the official added.
China is already able to co-operate with the EBRD and there have been plans for collaboration between the bank and the newly-created, Beijing-led Asian Infrastructure Investment Bank. But making China a shareholder would send a strong message of intent. “It is a question of prestige and politics rather than shareholder influence,” the person said.
Sir Suma told a meeting in Beijing in June that the EBRD was in “intense and wide-ranging dialogue” with the AIIB and that the two banks, with other multilateral banks, should work together, “co-financing where we can, to close the infrastructure gap”.
Jyrki Katainen, vice-president of the European Commission, said the EU would encourage deeper collaboration between China and the EBRD, including possible Chinese membership, at a meeting with Ma Kai, China’s vice-premier, last month.
Such enthusiasm for Chinese membership marks a dramatic change in European attitudes over the past few years.
Thomas Mirow, the EBRD’s president before Sir Suma, told reporters in May 2011 that Chinese membership of the bank was “not at all an issue” and “nor would it be very easy with regard to our statutes” — an apparent reference to the first lines of the EBRD’s charter, which say its members are committed to “multi-party democracy, the rule of law, respect for human rights and market economics”.
This has been no barrier to membership for countries in Central Asia, where the EBRD disbursed €800m last year out of a total of €8.9bn. Co-operation with the AIIB and other Chinese lenders would allow it to expand significantly its operations in the region, which lies at the centre of the land route of the new Silk Road.
http://www.ft.com/intl/cms/s/0/b34d5a78-7994-11e5-933d-efcdc3c11c89.html
China has made a formal request to become a member of the European Bank for Reconstruction and Development, a move that, if completed, would add to ever-closer ties between Europe and the world’s second-biggest economy.
EBRD membership would also open new channels for Chinese funding of infrastructure and other investments along its new Silk Road or “One Belt, One Road” project, linking China to markets in Europe and the rest of the world.
The application was confirmed by the bank as Xi Jinping, China’s president, ended a four-day visit to the UK last week that included promises of trade and investment deals worth tens of billions of pounds. Mr Xi and David Cameron, the UK prime minister, are understood to have touched on the issue of stronger ties between China and the EBRD during the visit, a possibility that would be welcomed in London.
An EBRD official said “a senior Chinese authority” — understood to be Zhou Xiaochuan, governor of the People’s Bank of China — had written to Sir Suma Chakrabarti, EBRD president, in August, proposing that China become a shareholder in the bank. Another person familiar with the matter said China would not become a country of operations for the EBRD and its shareholding would be a symbolic amount, “just to let them say they are a shareholder”.
Nobody at the Chinese embassy in London was immediately available for comment. The EBRD official said the request would be put before the bank’s existing shareholders — a group of 64 advanced and developing nations — for consideration and that the process was in its “early days”.
“We do try to attract Chinese investments,” the official added.
China is already able to co-operate with the EBRD and there have been plans for collaboration between the bank and the newly-created, Beijing-led Asian Infrastructure Investment Bank. But making China a shareholder would send a strong message of intent. “It is a question of prestige and politics rather than shareholder influence,” the person said.
Sir Suma told a meeting in Beijing in June that the EBRD was in “intense and wide-ranging dialogue” with the AIIB and that the two banks, with other multilateral banks, should work together, “co-financing where we can, to close the infrastructure gap”.
Jyrki Katainen, vice-president of the European Commission, said the EU would encourage deeper collaboration between China and the EBRD, including possible Chinese membership, at a meeting with Ma Kai, China’s vice-premier, last month.
Such enthusiasm for Chinese membership marks a dramatic change in European attitudes over the past few years.
Thomas Mirow, the EBRD’s president before Sir Suma, told reporters in May 2011 that Chinese membership of the bank was “not at all an issue” and “nor would it be very easy with regard to our statutes” — an apparent reference to the first lines of the EBRD’s charter, which say its members are committed to “multi-party democracy, the rule of law, respect for human rights and market economics”.
This has been no barrier to membership for countries in Central Asia, where the EBRD disbursed €800m last year out of a total of €8.9bn. Co-operation with the AIIB and other Chinese lenders would allow it to expand significantly its operations in the region, which lies at the centre of the land route of the new Silk Road.
