WASHINGTON, Apr 29: President Barack Obama has said the US is not opposed to China-led AIIB but cautioned that money could be “misused” if the new bank does not adhere to high accounting standards and transparency.
“Let me be very clear and dispel this notion that we were opposed or are opposed to other countries participating in the Asia Infrastructure Bank. That is simply not true. It sprung up out of one story after the Brits decided that they were going to join up, and then folks have just been running with it,” Obama said.
“This could be a positive thing. But if it is not run well, then it could be a negative thing,” he said while speaking at a White House press conference with Japanese Prime Minister Shinzo Abe yesterday.
The US initially urged its allies not to join as founding members of the Asia Infrastructure Investment Bank (AIIB), which is in the process of being established in Beijing with initial capital of USD 50 billion. China has signed up some 57 countries as founding members.
“Asia needs infrastructure. There are a lot of countries that have difficulty financing infrastructure, but if they got that infrastructure put in place and developed, they can grow much more rapidly. And that’s good for everybody. It’s good for that country. It’s good for the world economy. It’s good for us,” Obama said.
“We want more markets to be able to get our goods in and sell our services that are some of the best in the world. And China has got a lot of money. It’s been running a big surplus for quite some time. So to the extent that China wants to put capital into development projects around the region, that’s a positive. That’s a good thing,” he added.
Abe also echoed Obama’s view and said, “On the AIIB, in Asia there’s a tremendous demand for infrastructure, and the financial system to respond to this is very important. On this recognition, we see eye to eye between China and myself.”
“To create such an enormous financial institution and since this will have an enormous impact on Asian countries, a fair governance is necessary of the institution,” Abe said.
Obama said the US wants to ensure that the standards for the projects it backs are high.
“What we have said and what we said to all the other countries involved is exactly what Prime Minister Abe said, which is, if we’re going to have a multilateral lending institution, then you have to have some guidelines by which it’s going to operate,” said the US President.
“There may be weighted votes in terms of who’s the biggest contributor, but you’ve got to have some transparency in terms of how the thing is going to operate — because if not, a number of things can happen.
“Number one, money could end up flowing that is misused, or it doesn’t have high accounting standards, and we don’t know what happens to money that is going into projects,” he cautioned.
“So our simple point to everybody in these conversations around the Asia Infrastructure Bank is let’s just make sure that we’re running it based on best practices, based on what we’ve learned from the entire post-war era and how other multilateral financing mechanisms have worked,” Obama said. (PTI)
Follow our WhatsApp channel
