Since the Asian Infrastructure Investment Bank (AIIB) has a greater understanding of the developing world’s needs, this China-led bank will be different from institutions like the World Bank.

This confidence filled message was conveyed by the officials of the bank after its first annual meeting recently.

With 57 founding member countries and $100 billion in committed capital, which it plans to invest in projects across the Asian region, the bank began its operations in January this year. Chinese President Xi Jinping had proposed the formation of the bank about two years ago.

The AIIB is aiming to meet international standards of governance and it intends to invest $1.2 billion this year in various infrastructure projects. However some members say that there is still work to be done.

Chinese Finance Minister Lou Jiwei said the AIIB needed to establish its niche while speaking on the final day of the bank’s inaugural annual meeting.

“The AIIB needs to establish its comparative advantage relative to existing multilateral development banks like the World Bank,” Lou said.

“…Compared with the Asian Development Bank, World Bank and other multilateral development banks, the AIIB’s advantage lies in its keener understanding of the successful experience and lessons of developing countries’ years of development,” he added.

With three projects co-financed with the World Bank, the Asian Development Bank, the United Kingdom Department for International Development and the European Bank for Reconstruction and Development, the AIIB’s board approved its first four deals worth $509 million on Friday.

Highway construction in Pakistan and Tajikistan and a slum renovation project in Indonesia are the co-financed projects that were approved by the bank. The AIIB would solely finance a power grid upgrade project in Bangladesh very soon.

AIIB President Jin Liqun said that they were committed to the concept of international best practice and that it was the focus on infrastructure that specifically marked out the bank as different from other international banks.

“The question is, how do you define international best practice? I will not agree to anything which could be considered international best practice unless this kind best practice incorporates the development experience of China and many countries in Asia and elsewhere over the last three or four decades,” Jin said.

“So our bank would like to have the development experience, the so-called international best practice, reflecting the experience of China, India (and) so many countries in Asia. So we should have a different model of development,” Jin added.

The AIIB will take applications for new members through the end of September as it is also looking to expand its numbers this year.

(Adapted from Reuters)

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