With NDB established, Beijing turns to new bank for Asia

Want China Times, Kao Hsing and Staff Reporter 2014-07-18

A sign for the APEC 2014 second senior officials' meeting in Qingdao,
Shandong province, May 14. (File photo/CNS)

After the establishment of the New Development Bank (NDB) operated by the BRICS states on July 16, China is proposing to set up the Asian Infrastructure Investment Bank (AIIB) as another part of Beijing's bid to break the dominance of the United States and Japan-led international financial institutions.

The NDB, an alternative to the World Bank and the International Monetary Fund, is run by Brazil, Russia, India, China and South Africa.

China's next move is to launch the AIIB, which is considered a rival to the World Bank and the Japan-led Asian Development Bank.

The AIIB concept was proposed by President Xi Jinping at last year's Asia-Pacific Economic Cooperation (APEC) summit and its goal is to raise funds for infrastructure construction in Asia. In addition, the AIIB will invest in railways, road and airport construction that connects Central Asia, Middle East and Europe.

China has invited participation from 22 countries in the Middle East and Central and South Asia, as well as member states of the Association of Southeast Asian Nations (ASEAN).

Premier Li Keqiang championed the AIIB idea when meeting the prime minister of Kuwait in June. Xi also brought up the AIIB issue several times during his recent meeting with President Park Geun-hye of South Korea, and they are understood to have reached a certain consensus.

At the annual BRICS summit this year, to attract India's participation in the AIIB, Xi invited India's new prime minister, Narendra Modi, to attend the APEC summit set to be held in Beijing in November, the first time for India to attend the annual event having declined participation over the last decade.

China also hopes the invitation will prompt India to back the establishment of the AIIB as well as quell discontent in India at the NDB being headquartered in Shanghai.

Beijing plans to complete the memorandum of understanding for the structure and establishment of the AIIB by the end of this year and officially launch it during the first half of next year. It also plans to join the Eurasian Development Bank soon after.

Chinese President Xi Jinping (4-L, first row) poses with leaders of the

 CELAC group of Latin American and Caribbean states, in Brasilia, on July 17,

 2014 (AFP Photo/Nelson Almeida)

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