The China-initiated Asian Infrastructure Investment Bank (AIIB) was formally established Friday, marking a milestone in the reform of the global economic governance system as well as in the infrastructure development in the Asia-Pacific region.
Tasked with financing infrastructure construction across Asia, it took just two years for the bank to develop from an idea on paper to a fully-fledged body with 57 developed and developing nations as prospective founding members.
Analysts believed the major message behind the AIIB's rapid development is that the establishment of the bank, which upholds high standards and abides by strict regulations, is in line with the best interests of various parties.
Executive Deputy Director-General Zhou Qiangwu of the Asia-Pacific Finance and Development Center -- a think tank funded by the Chinese Ministry of Finance -- said the rapid and good progress the AIIB has made is partly attributed to China's growing national strength and rising global influence.
"On the other hand, it also shows that the government's goal of building the AIIB into an open, transparent and highly-efficient multilateral institution as well as the high standards it is upholding have garnered extensive recognition and strong support across the world," Zhou said.
"It is in line with the best interests, and meets the practical needs of various parties," Zhou added. Chinese officials have earlier stressed on many occasions that the bank will employ international, normative and high standards in its governance structure, operational policies and human resource management to avoid repeating past mistakes and ensure sound progress in a professional and efficient operation.
The AIIB's establishment was regarded by many analysts as "a milestone event." The existing global economic governance system has failed to reflect the status quo of the world economy, said Zhou, adding that it has also failed to safeguard the rights and interests the developing countries, including China, deserve, said Zhou.
"The formal launch of the AIIB, which is a late starter in the regional multilateral development institutions, will help accelerate reform of the global economic governance system," Zhou said. Actually, the "catfish effect" brought about by the establishment of the AIIB has already emerged around the world.
Last week, U.S. Congress approved long-stalled reforms of the International Monetary Fund that will give greater voice to emerging-market countries. With the rise of the AIIB, the Asian Development Bank (ADB) has also speeded up its paces in financial reforms so as to increase its lending capacity by more efficiently and effectively utilizing its existing resources.
At the 48th ADB Annual Meeting in May, ADB President Takehiko Nakao stressed the need to accelerate reforms and enhance the bank's lending capacity so as to ensure the bank could continue to play a constructive role.
"Now, the AIIB has already become a platform to improve global financial governance system," said Zhang Jianping, director of the International Economic Cooperation Institute of the National Development and Reform Commission.
Meanwhile, the AIIB's establishment will also boost the strength of multilateral development organizations and promote infrastructure development and economic growth in the Asia-Pacific region. The ADB's 2010 report on the infrastructure needs of 21 Asian economies estimated Asia's infrastructure gap at around 8 trillion U.S. dollars over the period 2010-2020.
"The AIIB will greatly boost infrastructure investment from multilateral development institutions in developing countries and emerging economies, thus promoting their economic growth," Zhou said. However, analysts also pointed out that the AIIB, while injecting fresh impetus into the global economic governance system and economic development of the Asia-Pacific region, is also faced with many challenges, such as how to keep balance between quality and efficiency.
But Zhou believed the AIIB "will not sacrifice high standards for the needs to develop regional economy." "Instead, the AIIB will steadily make headway and gradually enhance its lending capacity," Zhou added.
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