High expectations for Asia’s new bank
Print Edition
THE Asian Infrastructure Investment Bank, viewed by some as a rival to the World Bank and Asian Development Bank, was formally established yesterday, China’s Ministry of Finance announced.
Expectations are high for the China-proposed institution, which will operate in an open, fair and efficient manner, said its president-designate Jin Liqun.
Jin said the bank would enhance connectivity among Asian countries by supporting infrastructure development.
A prosperous Asia will offer huge markets for global enterprises hungry for business opportunities and boost international economic growth, he said.
The Beijing-based bank currently has 57 members and will be operational once its board of directors and executive council meet for the first time at an opening ceremony next month, the ministry said on its website.
With authorized capital of US$100 billion, it expects to offer its first batch of loans by the middle of the year, Jin said.
It will mainly invest in infrastructure, energy, transport, urban construction, water supply and logistics as well as education and health care, he said.
Specific loan policies will be discussed at the board meeting.
Jin said the bank will take account of Asia’s rising energy demands and the battle against climate change when deciding if it will finance coal-fired and nuclear power projects.
“Our target projects must be financially, environmentally and socially sustainable,” he said.
The bank is open to global professionals and to more members, Jin added.
Based on the GDP volume and capital contribution, China holds the highest voting stake among all members.
As new members join, all founding members’ shares and voting stakes will be “gradually diluted.”
The AIIB has a three-tier structure — a board of governors, a board of directors and a management team.
The bank will enroll employees openly and transparently to select those with a good work ethic, outstanding professional expertise and strong commitment, Jin said.
Everyone is welcome to apply for available positions. However, the recruitment process will be strict, he added. “There will be no lifelong positions here. All employees will have a one-year probation period.”
Profit maximization will not be the AIIB’s goal due to its multilateral financial institution status, but the bank’s investment projects had to be profitable to ensure financial sustainability, Jin said.
To reduce costs, the board will not be based in the bank and competition will be encouraged in recruitment and purchasing. Meanwhile, the audit department will oversee business compliance, performance and work ethics.
The bank is also working on documents to ensure business practices are in line with environmental and social development.
“There will be zero tolerance of corruption, and we will make the bank lean, clean and green,” Jin said.
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