AIIB approves first loans in Xi push for influence

The China-led Asian Infrastructure Investment Bank announced its first loans for projects ranging from a slum upgrade in Indonesia to a highway in Pakistan.

The four loans total $509 million, with three of them co-financed with other multilateral development banks, according to an e-mailed statement by the bank on Friday. AIIB is targeting lending of about $1.2 billion this year, according to the statement.

The four projects are the first batch funded by the China-led multilateral development bank with 57 founding members. The organisation, which has been in operation since January with registered capital of $100 billion, is central to President Xi Jinping's ambition to seek a bigger voice in global affairs and deeper economic integration with its neighbours.

"These projects, which span the energy, urban development and transport sectors, will help to bridge the region's critical infrastructure financing gap and strengthen regional connectivity," President Jin Liqun wrote in the statement.

He said that the bank is working on some additional projects.

The four approved loans include the following, according to the statement:

• $216.5 million for a slum upgrading project in Indonesia, co-financed with the World Bank.
   
• $165 million for a power distribution system in Bangladesh.
   
• $100 million for a section of a highway in Pakistan, co-financed with Asian Development Bank and the United Kingdom's Department for International Development.
  

 

$27.5 million for improving a border road in Tajikistan, co-financed with the European Bank for Reconstruction and Development.

Vice-premier Zhang also said that China will contribute $50 million to a new fund set up by AIIB to support member countries with project preparations.

The AIIB is looking to expand its numbers this year and will take applications for new members through the end of September, Jin said.