China’s Asian Infrastructure Investment Bank (AIIB ) has approved a further seven member nations, adding to the thirteen new members it approved in March. The new members, which are Bahrain, Bolivia, Chile, Cyprus, Greece, Romania and Samoa, bring the total members on board to 77.
The seven prospective members also need to complete the required domestic processes and deposit their first installment of capital with the AIIB before officially joining the bank.
The bank, which began operations at Beijing’s instigation in January 2016, pools financing from its members and repackages these into mutually agreed funds for “Asian investment” projects. AIIB’s largest shareholders include China, India, and Russia.
Related: China’s AIIB – The Facts To Know
Many of these are One Belt, One Road (OBOR) related, with the first AIIB approved loan being for power station investments in Pakistan. More recent loans have been granted to finance US$125 million for a dam project in Indonesia and a further US$100 million for the Indonesian Regional Infrastructure Development Fund. Both the Indonesian projects have been co-financed by the World Bank.
Another US$60 million loan was granted to improve a gas transmission network in Bangladesh, co-financed by the Asian Development Bank (ADB). The new loans increased the multilateral
Several financial institutions exist which are in part responsible for some OBOR financing. These include Russia’s Eurasian Development Bank the BRICS New Development Bank as well as China’s Silk Road Fund. The cost of developing the OBOR routes is expected to top USD8 trillion, a investment expense we examined in some detail in the article “Financing China’s One Belt Road USD8 Trillion Capital Requirements“.
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