KUALA LUMPUR, Oct 25 – MALAYSIA has joined 20 proposed founding member countries to set up Asian Infrastructure Investment Bank (AIIB) with an initial authorised capital of US$50 billion (RM164 billion). One fifth of the initial US$50 billion will be paid-up, the Ministry of Finance said in a statement yesterday.
Malaysia and other founding member countries such as China, Singapore, Thailand and the Philippines signed a memorandum of understanding (MoU) for the proposed multi-lateral development bank (MDB) in Beijing, China yesterday. Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah signed the MoU on behalf of the government.
Husni said AIIB will focus on financing physical infrastructure projects for economic growth, and will complement existing MDBs such as the Asian Development Bank and the World Bank which are more focused on eradicating poverty. AIIB will also supplement organisations like Asean Infrastructure Fund, by co-financing large scale infrastructure projects.
“AIIB will utilise commercial funding from financial markets to raise the necessary resources to provide competitive loans to member countries. The resources will be allocated based on three key criteria: regional development impact, assisting the poor and no fixed system based on share allocation,” Husni said.
The bank targets to accelerate infrastructure development in energy and power, transportation, telecommunication, rural infrastructure and agricultural development, urban development, logistics and other productive sectors, he added. Husni was in China to attend the 21st APEC Finance Ministers’ Meeting in Beijing, China.