China is set to officially launch the new $50 billion Asia Infrastructure Investment Bank (AIIB) this Friday as an alternative to the World Bank, whom the nation feels is dominated by the U.S. and their allies, the Financial Times (FT) reports.
Twenty mostly smaller economies, including many of which are effectively client states of China, are set to become founding members of the new infrastructure bank during Friday’s ceremony that will be held in Beijing following Washington’s efforts to “furiously” stop other countries from signing up, the FT said.
Following Beijing’s announcement to establish the bank last year, several European states, in addition to Australia, Indonesia, and South Korea had initially showed interest, however after U.S. pressure, none of these nations plan to join the bank at this particular juncture, the FT said.
India will be the only large economy that will be joining the bank, according to the FT, citing people whom are familiar with the matter.
Alongside India, members of the bank will include Mongolia, Uzbekistan, Kazakhstan, Sri Lanka, Pakistan, Nepal, Bangladesh, Oman, Kuwait, Qatar, in addition to all of the Association of Southeast Asian Nations (ASEAN) except for Indonesia, the FT said.
Indonesia said that their newly installed government hadn’t yet had time to weight the proposal, according to the FT.
The new bank will start up with a $50 billion capitalization, with the bulk of the money contributed by China, however China said that it is hoping to increase that amount to $100 billion.
The new infrastructure bank will be initially focusing on creating a “new silk road” in an effort to open new trade routes to Europe, including a direct rail link from Beijing to Baghdad, the FT said.
Source: The Financial Times
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