Xi eyes better global financial governance as MOU signed on new multilateral bank

Chinese President Xi Jinping (C, front) meets with representatives of 21 Asian countries who signed the Memorandum of Understanding on Establishing Asian Infrastructure Investment Bank (AIIB) in Beijing, capital of China, Oct. 24, 2014. (Xinhua/Huang Jingwen)

Chinese President Xi Jinping looks forward to better global financial governance as 21 countries signed a memorandum of understanding (MOU) Friday on establishing a new multilateral bank to finance infrastructure projects in Asia.

Xi made the remark as he met with representatives from the 21 countries involved in setting up the Asian Infrastructure Investment Bank (AIIB) at the Great Hall of the People in downtown Beijing.

The representatives were from Bangladesh, Brunei, Cambodia, China, India, Kazakhstan, Kuwait, Laos, Malaysia, Mongolia, Myanmar, Nepal, Oman, Pakistan, the Philippines, Qatar, Singapore, Sri Lanka, Thailand, Uzbekistan and Vietnam.

The memorandum specifies that the authorized capital of the AIIB is 100 billion U.S. dollars and the initial capital is expected to be around 50 billion dollars. The paid-in ratio will be 20 percent. As agreed, Beijing will be the host city for the AIIB's headquarters.

It is expected that the prospective founding members will complete the signing and ratification of the Articles of Agreement in 2015 and the AIIB will be formally established by the end of 2015.

Congratulating the representatives on inking the memorandum, Xi said it reflects all the parties' aspiration, determination and action for unity and cooperation in pursuit of common development.

"(The establishment of the AIIB) will help to improve global financial governance, which is very meaningful," Xi said, adding that he hopes all sides concerned will make concerted efforts to make the AIIB a financing platform of infrastructure construction featuring equality, inclusiveness and high efficiency, and multilateral development bank that meets the demand of all countries in the region.

"To become rich, you need to build roads first," Xi said during the meeting, quoting a Chinese saying.

He said the AIIB should focus on boosting interconnectivity of infrastructure and economic cooperation in the region to inject new driving forces into the economic development in Asia.

Xi stressed inclusiveness and multilateralism in the development of the AIIB, saying that all countries with interest are welcome to join the bank and that the AIIB should work together with other multilateral development organizations to promote prosperity in Asia as well as the world at large.

Briefing the representatives on China' economic prospect and ongoing overall reform, Xi said China will firmly stick to the opening-up strategy for win-win reciprocity.

"The purpose of my proposing a joint push to build the Silk Road Economic Belt and the 21st Century Maritime Silk Road is also to deepen economic cooperation among Asian countries for common development," said the Chinese president. The AIIB was proposed by Xi as he visited southeast Asia last October.

"We will make further efforts to make China's development more beneficial for countries in Asia as well as the whole world," he added.

Singapore's Deputy Prime Minister Tharman Shanmugaratnam, on behalf of all the foreign representatives, expressed appreciation for proposing and leading the establishment of the inter-governmental regional development institution in Asia.

Shanmugaratnam said the establishment of the AIIB will be a milestone and strongly improve the infrastructure and long-term development in Asia.

Echoing Xi's remarks, Shanmugaratnam said all the participants will adhere to openess and multilateralism, and work together to make preparations for the establishment and operation of the AIIB smoothly and make it a good example for multilateral cooperation in the world.