Australia Set To Join Negotiations On China-Led Bank

Australia's government confirmed Sunday that it intends to join negotiations to set up the China-led Asian Infrastructure Investment Bank (AIIB) about which the U.S. has voiced concerns.



Prime Minister Tony Abbott, Foreign Minister Julie Bishop and Treasurer Joe Hockey released a joint statement saying the government would sign a memorandum of understanding that would allow the country to take part as a prospective founding member.



"Good progress has been made on the bank's design, governance and transparency over the past few months, but we still have issues that we will address through ongoing consultations," Abbott said in the statement.



He added that the bank could potentially play a valuable role in the region's infrastructure needs and economic growth through cooperation with other multilateral institutions such as the World Bank and The Asian Development Bank.



"Recognising the pressing need for infrastructure investment in the Asia-Pacific, Australia made infrastructure a priority during our G20 presidency in 2014."



Before Australia considers joining the AIIB, however, certain matters -- such as the authority of the bank's Board of Directors over key investment decisions and the bank not being controlled by a single country -- would have to be resolved, he added.



Australia could reportedly invest up to $3 billion in the Beijing-based institution, according to ABC News.



The bank, launched late last year with the aim of helping finance development projects in the region, has drawn open caution from Washington over whether it will meet global standards.



According to bankers, however, the U.S. is concerned that the bank will challenge global economic institutions such as the World Bank, the Asian Development Bank, and the International Monetary Fund -- in which the U.S. has more voting power than China and other emerging markets.



More than 20 countries have signed the memorandum of understanding, and in the past month, major Western countries -- such as the U.K. and Germany -- as well as Turkey have applied to be founding members.



www.aa.com.tr/en - Ankara