Non-Asian countries to be included in AIIB Board
May 26, 2015 Category Finance, Weekly
The Chinese government is proposing to include non-Asian countries on the board of the Asian Infrastructure Investment Bank (AIIB) to give smaller shareholders a voice in the institution. No country will have more than one seat on the 12-member Board of Directors. China says it will not hold veto power in the AIIB, unlike the World Bank where the United States has a limited veto. Germany will have a Director on the Board of the AIIB, according to German Ambassador to China Michael Clauss. He added that Germany wanted the Board’s make-up to reflect the various regions joining the Beijing-led bank, and that Frankfurt would be a good candidate for the bank’s European headquarters. Founding members of the bank will initially pay up to one-fifth of its USD50 billion authorized capital, which will be raised to USD100 billion. The founders of the bank also wrapped up negotiations over the text of the organization’s charter during a three-day meeting in Singapore. The articles will be signed at the end of June and will then be presented to each nation’s legislature for approval. Delegates who attended the Singapore meeting said China is likely to take a 25% to 30% stake in the AIIB, and India is likely to be the second-largest shareholder. In all, Asian countries are expected to own between 72% and 75% of the bank. The Singapore meeting was the fifth to be held since the signing of a Memorandum of Understanding on establishing the AIIB in Beijing in October last year.
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