Member countries have agreed on a charter for the Asian Infrastructure Investment Bank.
By Shannon Tiezzi
The Diplomat - May 23, 2015
In March, a flurry of counties (including U.S. allies like the U.K.,
South Korea, and Australia), applied to join China’s new Asian
Infrastructure Investment Bank (AIIB) before the March 31 deadline for
joining as a founding member. The new bank will have authorized capital
of $100 billion, to be used in infrastructure projects throughout Asia.
Being a founding member means having a say in the AIIB charter –
especially important for countries that had expressed concern about
governance issues related to the new bank. Today, China’s Ministry of
Finance announced
that the 57 founding members of AIIB have agreed upon the bank’s
charter, which will be signed in a ceremony in Beijing at the end of
June.
The AIIB negotiators met in Signapore from May 20-22 for talks on the
bank’s charter. At stake were a number of concerns: how the bank’s
capital will be provided and the corresponding stakeholder levels of
each country. China has previously said that 75 percent of AIIB shares
will be reserved for Asian countries, meaning European countries like
the U.K., Germany, and France will have little say.
Delegates from the Singapore meeting told Reuters that
China will likely wind up with a 25-30 percent stake in the bank,
making it the largest shareholder. India is expected to be the second
largest shareholder at 10-15 percent. That meshes with predictions from the Korean Institute for Economic Policy,
which calculated that China and India would be the largest shareholders
at roughly 30 and 10 percent, respectively. KIEP, which based its
calculations on having 75 percent of shares for Asian countries and
allocating shared based on GDP and PPP (purchasing power parity),
predicted that Indonesia, Germany, and South Korea would be the next
three largest shareholders, all with just under 4 percent.
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