Xi hails AIIB opening as ‘a historic moment’

Two years later, the bank was formally set up with the Articles of Agreement taking effect on 25 December last year.

The launch of the bank on Saturday in Beijing was attended by representatives from 57 member countries, including India, which will contribute $8 billion, only second to China’s $ 29.7 billion. “Annual demand for infrastructure investments is projected to be approximately US$730 billion, but only 3% of that demand is met through bilateral and multilateral development funds”, Yoo said. Earlier, the U.S. and Japan have said that AIIB will be “more of a tool Beijing could use for its own good”. The ongoing meeting of the Bank in Beijing of China nominated Nepal as a member of the board today.

Dar said he hoped that AIIB would work well together in conjunction with other development banks and fill the infrastructure development deficit in the region.

The AIIB is headquartered in Beijing and headed by President Jin Liqun, who previously served as China’s vice minister of finance.

Launching the China-led bank here yesterday, Chinese President Xi Jinping said this proved China’s willingness to shoulder more worldwide responsibility and “push for the perfection of the global system”.

With authorised capital of $100 billion and subscribed capital of $50 billion, the AIIB will invest in sectors including energy, transportation, urban construction and logistics as well as education and healthcare. However, Mr Xi sought to dispel notion that China would dominate the new financial institutions and exhorted other countries also to pitch in.

It could also help Beijing stamp its mark on a bank regarded by some in the government as a political as much as an economic project. “Appointments to the top position at other major global financial institutions have for decades been nationality-based”, he said.

Jin said that Asia still faced “severe connectivity gaps and significant infrastructure bottlenecks”.

While a more than dozen European countries made a decision to join the AIIB, Japan and the United States did not do so, citing such reasons as skepticism over whether it will have sound lending standards and whether infrastructure projects to be funded by it will be environmentally friendly. “I will try to avoid creating senior positions just for the sake of meeting the needs of some countries as that will lead to redundancies in the future”, he said, noting that the bank’s human resources head is not a Chinese national.