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With the unveiling of the list of 57 prospective founding members (PFMs) of the Asian Infrastructure Investment Bank (AIIB) on April 15, officials of China's Ministry of Finance are working around the clock to prepare for the signing of the bank's charter, scheduled for late June.
The preparatory office has to face the various demands of the PFMs, as they jostle for positions of power in the bank, including the appointment of the first president and 11 vice presidents. Following their meeting in Beijing in late April, chief representatives of the PFMs are slated to convene in Singapore again in late May for formulating the bank's charter.
The warm reception to the AIIB initiative is out of the expectation of many observers. Of the 57 founding members, 37 come from Asia and Oceania and the remaining 20 from Europe, Latin America, Africa and the Middle East. By comparison, the Asian Development Bank (ADB) has 31 founding members, the World Bank 28 founding members, and the European Investment Bank six founding members. "The number of founding members surprised me," said Shang Youguang, associate professor at the financial college of the Central University of Finance and Economics.
According to the memorandum for the establishment of the AIIB, signed by the first round of 21 founding members on Oct. 24 last year, the AIIB, with a registered capital of US$100 billion, aims to raise an initial capital of US$50 billion, 75% of which will be contributed by Asian members, according to the weighting of their GDPs, and the remaining 25% from members from other regions.
Based on 2013 GDP figures, China will hold a stake of 36.86%, followed by India with 7.48%. South Korea, Germany, Indonesia, Turkey and Saudi Arabia will follow from third through seventh place, according to calculations by the China Economic Weekly.
Jin Canrong, vice president of the College of International Relations at Renmin University of China, said that while the AIIB will follow business principles to prevent loss, profit-seeking is not one of its primary considerations, as it is essentially a policy bank with the mission of helping less-developed Asian nations achieve economic development.
"In order to compete with the World Bank and the International Monetary Fund, the AIIB has to offer preferential terms for its loans," said Shang Youguang.
Nepal may become AIIB's first client for rebuilding funds
Nepal will need US$1.8 billion from the international community to rebuild after the devastating April 25 quake that has killed at least 7,600 and injured more than twice as many. The relatively poor Himalayan country may turn to the Asian Infrastructure Investment Bank (AIIB) for financial aid and become its first client, reports the Beijing Times.
Authorities estimate the final death toll from the 7.8-magnitude quake that struck near the capital Kathmandu may be in excess of 10,000, while UN sources say 8 million of the country's total population of 28 million have been affected by the disaster. Two million will be living in refugee camps for at least the next three months.
As the possibility of finding survivors diminishes, the international aid mission turns to humanitarian aid and reconstruction work.
Nepal's foreign minister, Mahendra Pandey, said on May 4 that the government hopes to raise US$2 billion for post-quake reconstruction. The government has US$200 million set aside and is calling for the international community to supply the remainder. The amount is based on an estimation and may need to be adjusted later, the minister added.
The finance minister, Ram Sharam Mahat, has said the government is evaluating the cost for reconstructing buildings, transportation infrastructure and restoring places of cultural heritage and will turn to the China-backed AIIB for financial aid.
The institution, with 57 prospective founding members, is to be established by the end of the year.
Poster Comment:
So while Uncle Sam is alienating America from the rest of the world by providing protection for Israeli thieves...