China led Asian largest shareholder Infrastructure Investment bank launched

China led Asian largest shareholder Infrastructure Investment bank launched.  The Bank (AIIB) launched here Friday.

With 21 Asian nations signing up for the initiative seen by some as a regional rival to the World Bank.

The bank, to be capitalized with $50 billion, will fund infrastructure projects.

Like roads, railways, power plants and telecommunications networks in the Asian region.

Speaking at the launch ceremony, Chinese Finance Minister Lou Jiwei confirmed his country.

Would the largest shareholder with up to 50 percent stake in the bank.

Countries that committed to join the initiative and were present at the inauguration ceremony included Bangladesh, Brunei, Cambodia, China, India,

Kazakhstan, Kuwait, Laos, Malaysia, Mongolia, Myanmar, Nepal, Oman, Pakistan, the Philippines, Qatar, Singapore, Sri Lanka, Thailand, Uzbekistan, and Vietnam.

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Three key countries of the region – Australia, Indonesia and South Korea however skipped the launch of the Asian infrastructure bank.

Even as the United States said it had concerns about the new rival to Western-dominated multilateral lenders.

China led Asian largest shareholder Infrastructure Investment bank launched.

According to a report in the Australian Financial Review, the US Secretary of State John Kerry personally.

Asked Prime Minister Tony Abbott not to join the bank, while Korean officials say they are “negotiating with China” over membership.

China led Asian largest shareholder Infrastructure Investment bank launched.

US State Department Spokesperson Jen Psaki denied the reports stating: “Secretary Kerry made clear directly to the Chinese.

Ss well as to other partners that we welcome the idea of an infrastructure bank for Asia.

But we strongly urge that it meet international standards of governance and transparency.”

China led Asian largest shareholder Infrastructure Investment bank launched

The Chinese Finance Minister described the AIIB as “an open and inclusive institution” which will be headquartered in Beijing.

Foreign Ministry spokeswoman said on Thursday that relevant sides will sign the memorandum of understanding (MoU) after domestic examination and approval procedures.

The MoU specifies that the authorised capital of AIIB is $100 billion and the initial subscribed capital is expected to be around $50 billion. The paid-in ratio will be 20 percent.

China has held a series of multilateral and bilateral consultations this year on setting up the AIIB and received positive responses, according to Hua.

China led Asian largest shareholder Infrastructure Investment bank launched.

During his Southeast Asia visit last October, Chinese President Xi Jinping put forward a proposal to establish the AIIB.

China led Asian largest shareholder Infrastructure Investment bank launched.

To promote interconnectivity and economic integration in the region.

Speaking at the inauguration, the Chinese President said: “In China we have a folk saying.

If you would like to get rich, build roads first, and I believe that a very vivid description of the very importance of infrastructure to economic development.

” He said the bank hoped to make its first loans in 2015.

China also the driving force behind the New Development Bank – known colloquially as the BRICS Bank.

After its member nations Brazil, Russia, India, China, and South Africa – which also set to fund infrastructure projects to the tune of $50 billion.

With the capitalisation of the fund set to rise to $100 billion.

Despite being the biggest recipient of World Bank funds, China has found itself constrained by the big multilateral organisations such as the World Bank, IMF, and International Energy Agency (IEA).

China led Asian largest shareholder Infrastructure Investment bank launched.

Wants to be a lender, as well as a borrower at concessionary rates, as this gives them policy influence over those countries to which it directs funds.

China led Asian largest shareholder Infrastructure Investment bank launched.

Said Ben Steill, Director of International Economics at the Council on Foreign Relations (CFR) reported IBTimes UK.

Takehiko Nakao, President of the Asian Development Bank (ADB), welcomed the AIIB saying that the infrastructure gap on the continent is vast and additional finance to plug that gap is welcome.

However, he warned that the bank must meet environmental and social standards in its lending if it is to accepted as part of the mainstream lending sector.

Addressing the concern, the Chinese President brushed aside any criticism.

Saying the AIIB “would follow multilateral rules and procedures.” The lender is to start operating in 2015.