South Korea will contribute $750 million of paid-in capital over the next five years in the Chinese-led Asian Infrastructure Investment Bank to become the fifth-largest shareholder, the South Korean Finance Ministry said Monday.
A total of 57 countries, including South Korea, have joined the AIIB, which is seen as a potential counterbalance to U.S.-led multilateral lenders such as the Asian Development Bank and the World Bank.
Overall, the AIIB, set to be operational by the end of this year, will have a paid-in capital of $20 billion and total authorized capital of $100 billion, the ministry said in a statement.
Representatives from 57 founding members of the AIIB, including South Korean Finance Minister Choi Kyung-hwan, attended the Articles of Agreement signing ceremony, which was held at the Great Hall of the People in Beijing earlier in the day.
Seven countries, including the Philippines, did not sign because their domestic procedures were not completed.
China became the biggest shareholder of the AIIB with a stake of 30.34 percent, followed by India with 8.52 percent, Russia with 6.66 percent, Germany with 4.57 percent and South Korea with 3.81 percent.
China also has 26.06 percent of voting rights in the AIIB, followed by India with 7.51 percent, Russia with 5.93 percent, Germany with 4.15 percent and South Korea with 3.5 percent.
During the signing ceremony, Chinese President Xi Jinping said, "By establishing the AIIB, the Chinese side is helping to promote international and regional cooperation."
"As long as we pursue multilateral cooperation, we are able to make the AIIB a new platform for mutually beneficial cooperation and contribute positively to infrastructure-building in Asia," Xi said.
Despite China's pledge to ensure transparency in the AIIB's operation, the voting structure allows China to have a de facto veto power in the AIIB.
The United States and Japan did not join the AIIB, while calling for transparency and higher governance in the new bank.
Along with concerns over transparency of the AIIB, there are worries that China would exploit the new lender as a means to increase its own economic and geopolitical influence in Asia. (Yonhap)
