Business / Economy

NDB president says to work with AIIB, hails bloc's significance

(Xinhua) Updated: 2015-07-24 10:45

SHANGHAI - The New Development Bank (NDB) will work with the Asian Infrastructure Investment Bank (AIIB) on different projects, NDB president KV Kamath told reporters on Thursday.

The New Development Bank (NDB) opened in Shanghai on Tuesday to finance infrastructure projects, mainly in BRICS countries.

BRICS countries are the world's major emerging economies: Brazil, Russia, India, China and South Africa. BRICS leaders signed an agreement to establish the bank during their sixth summit in Brazil in July, 2014. The bank will start operations at the end of this year or early in 2016.

"There are so many structures we can work with (the AIIB)," Kamath said during an interview in Shanghai. "Infrastructure and project needs are very large, so we will collaborate with everyone."

"We have partnerships that we will forge with the AIIB, the national loan banks and indeed, the exiting market loan banks," he said.

With an authorized capital of $100 billion, the China-initiated multilateral bank AIIB is designed to finance infrastructure in Asia. China, India and Russia are the three largest shareholders, with a voting share of 26.06 percent, 7.5 percent and 5.92 percent, respectively.

Chinese Finance Minister Lou Jiwei said Tuesday that both the NDB and the AIIB showed how emerging economies could improve global infrastructure and reform global economic governance. The two will complement each other, as they are different in membership and have different directions. The global demand for infrastructure funding is huge, he said.

Other institutions, including the World Bank Group (WBG), have expressed intent to work with the NDB.

"We are committed to working closely with the New Development Bank and other multilateral institutions, offering to share our knowledge and to co-finance infrastructure projects. These types of partnerships will be essential to reach our common goals to end extreme poverty by 2030, boost shared prosperity, and to reduce inequalities," Jim Yong Kim, WBG president, said in a statement on Tuesday.

But before any cooperation, Kamath said it is important for the NDB to stand firm first.

"The first step is to establish ourselves...and get our policies and framework right," he said.

The NDB will have an initial authorized capital of $100 billion, and initial subscribed capital of $50 billion "equally shared" among the five founders.

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