The Chief negotiators of the Asian Infrastructure and Investment Bank (AIIB) have met in Singapore to discuss operational matters concerning the establishment of the bank for three days.
During the meeting Japan announced it unveiled a plan to provide $110 billion to be invested over five years. This amount tops the expected $100 billion capitalisation of the AIIB.
However, Japanese officials said the plan, which was announced by Prime Minister Shinzo Abe, represents a 30 percent increase over Tokyo’s previous infrastructure funding.
Japan said it wants to focus on “high quality” aid, like helping recipients in reducing pollution, while building roads and railways. “We intend to actively make use of such funds in order to spread high-quality and innovative infrastructure throughout Asia, taking a long-term view,” said Abe, announcing the plan.
About half of the funds will be extended by state affiliated agencies in charge of aid and loans and the rest in collaboration with the Asian Development Bank (ADB). Japan hopes the aid will help draw private funds to help meet the vast demand for infrastructure in Asia.
A total of 57 countries have so far joined the AIIB as founding members, including 37 from Asia, which is planned to mainly finance infrastructure projects in Asia. Stakes at the fund will be divided among members based on their gross domestic product and purchasing power parity.