The head of the Asian Infrastructure Investment Bank said he was looking forwardto working with the EBRD on a raftof new projects in Central Asia and beyond, after tying up the first major infrastructure project co-financed by the two multilaterals: a $106m road improvement project in Tajikistan.
Jin Liqun, chairman and president of theAIIB, said in an exclusive interview with Emerging Marketsthat he was “very much encouraged” by the rapid pace of progress made on the project in the Tajik capital of Dushanbe. He added that this was just the start of long and fruitful period of co-operation between the two sides. “After this project, we will look for future operations we can work on together in member countries. I foresee that you will start to see many more encouraging projects starting to materialise.”
He lauded the EBRD’s ambitions over the past quarter-century, adding that the Beijingbased multilateral, officially launched in January with 57 founding member states, had “a lot to learn” from its counterpart. “From a technical point of view there is so much that they can teach us, given their status as a mature multilateral financial outfit. From the very beginning, we have nurtured a very good chemistry between the two institutions. Jin said co-financing was beneficial to both multilaterals. “Together, we can leverage our resources more than would otherwise be possible, which also helps us to both spread and reduce our risks. We will invest in any project so long as it meets three basic requirements: that it is financially sustainable, environmentally friendly, and socially acceptable.”
He also inferred that the growing relationship between the two development banks was rooted in the friendship between their respective leaders. “Sir Suma Chakrabarti is a good friend of mine,” he said, referring to the president of the EBRD.
“We were on the main board of the World Bank together in the 1990s, and he is a very capable and dedicated man, demonstrating very high levels of ethical integrity. I hold him in the highest respect and I am very happy to be working with him.”
This endorsement came just hours ahead of the decision of the EBRD's shareholders to grant Sir Suma another four year term, as he saw off a challenge from former Polish finance minister Marek Belka. It will be seen as support for his progress in its traditional countries of operations while moving in to new areas in North Africa.
NOT JUST OBOR
The AIIB chief also said the new multilateral was keen to stretch its wings, and to invest in projects in all its member states, not just in nations along the ‘One Belt, One Road’ (OBOR) route, a Chinese policy initiative to boost development in a region stretching from east Asia through Central Asia, Russia, and emerging Europe. “Our bank was not created just to cater to needs of the One Belt, One Road principle,” Jin said. “We are owned by 57 member nations, and we have more countries waiting to join. OBOR and the AIIB are related to a certain level, but they are not the same. People should not be confused about that.”
Jin added that the AIIB was focused heavily on being a sustainable responsible investor, noting that the bank could in the near future “both invest in green bonds using our equity capital, as well as issue green bonds”. He added that while the staple currency of the Beijing-based multilateral would remain the US dollar for the near future, the bank would not rule out issuing local currency bonds. “If it met our needs, and for the purpose of financing, investing, and securing high returns on capital, we would look at issuing debt in the local currency of any of our member states.”