Japan signalled cautious approval of the China-led Asian Infrastructure Investment Bank (AIIB) yesterday and said for the first time that, if conditions were met, it could join the institution that the US has warned against.
Australian Treasurer Joe Hockey said there was “a lot of merit” in the bank and the Sydney Morning Herald newspaper reported that Canberra could formally decide to sign up when the full Cabinet meets on Monday.
The US, worried about China’s growing diplomatic clout, has questioned whether the AIIB will have sufficient standards of governance and environmental and social safeguards.
But after Britain broke ranks with Western nations and said earlier this month that it would join the AIIB, other major EU members have followed suit.
Australia now appears close to joining, although no formal decision has been made, and South Korea may be as well.
Japanese Finance Minister Taro Aso said Tokyo could consider joining the China-led bank if it could guarantee a credible mechanism for providing loans.
Australia now appears close to joining, although no formal decision has been made
“We have been asking to ensure debt sustainability taking into account its impact on environment and society,” he told reporters after a Cabinet meeting. We could (consider to participate) if these issues are guaranteed. There could be a chance that we would go inside and discuss. But so far we have not heard any responses.”
Australia’s Hockey said no final decision had been made on Australia’s involvement but the matter had been under careful consideration.
“More than 30 countries have already signed up. This is going to operate in our region, in our neighbourhood,” he told a radio station in Brisbane.
The Sydney Morning Herald said Canberra could invest as much as A$3 billion (£2 billion) in the bank and that the National Security Committee has cleared the way for the investment.
Hockey said joining the AIIB would not affect Australia’s close relationship with the US and also referred to the gains that Australian companies could reap.