Finland Times

 

Finland on Monday signed the agreement on the founding of the Asian Infrastructure Investment Bank (AIIB) in Beijing, said a press release of the Ministry of Finance.

 

AIIB is an international financial institution whose mission is to support economic development, create wealth, and promote regional cooperation in Asia by investing in infrastructure projects.

 

The bank would operate primarily on a commercial basis. Membership in the bank is open to all.

 

The AIIB founding members include 37 Asian countries and 20 countries from outside Asia.

 

AIIB is to start operations at the beginning of 2016.

 

The basic capital of the AIIB will be 100 billion dollars. Finland's share of the capital of the bank will be 0.3 percent which amounts to 310 million dollars.

 

As it has been agreed that the share of capital to be paid in will be 20 percent, Finland's share of this will be 62 million dollars, or about 56 million euros. 

 

There is considerable need for investment into infrastructure in Asia. The development of infrastructure is important for regional integration, economic growth in Asia, and sustainable development, said the release.

 

AIIB will augment the activities of existing international financial institutions already operating in Asia, such as the Asian Development Bank and the World Bank.

 

The key focal areas of AIIB are energy, telecommunications, water management, and environmental protection, in which Finland also has special skills and knowledge.

 

AIIB is a key part of China's goal of taking a role that is proportionate to its economic weight in developing and maintaining the international economic architecture. Finland's decision to sign the founding document is a strategic step toward closer economic and trade relations with China.

 

Finland's possibilities to expand practical economic and trade relations to other countries of the Asian region will also increase, according to the Ministry of Finance.

 

The founding agreement requires the consent of Parliament.

 

The payments connected with the capital required by Finnish AIIB membership fall under the budgetary discretion of Parliament, and the required authority and proposed funding will be included in the state budget proposal.