- Country to be founding member just before Dec. 31 deadline
- China, Philippines embroiled in maritime territorial dispute
After months of holding out, the Philippines on Wednesday said it would join the China-led Asian Infrastructure Investment Bank before a year-end deadline for founding members.
The Southeast Asian nation will sign the AIIB’s articles of agreement before Dec. 31, the government said in a statement. The Philippines said its indicative paid-in capital would be $196 million, payable over five years.
As recently as a few weeks ago, policy makers were undecided about joining the $100 billion development bank initiated by China, the Manila Bulletin said, citing comments by Finance Secretary Cesar Purisima. The Philippines is among several countries involved in territorial disputes with China in the South China Sea, just as the region grows increasingly reliant on Asia’s biggest economy for trade.
“The Philippines stands to gain from signing on as a founding member," Purisima said in the statement Wednesday. "We can look forward to deepening our country’s technical expertise in infrastructure as we expand bankable projects."
China claims more than 80 percent of the water body based on a 1940s map that has no precise coordinates, and its recent reclamation work in the area has increased diplomatic tensions in the region. China’s $40 billion Silk Road initiative, which will link China to Europe through central and western Asia, focuses on neighbors such as Indonesia, a non-claimant state.
The Philippines’ decision to join the development bank may also help expand the market for infrastructure-related industries, boosting job and business growth, Purisima said in the statement. President Benigno Aquino, who will leave office after an election next year, had the final say on joining, Purisima said in the Manila Bulletin article.
The AIIB will hold its opening ceremony in Beijing Jan. 16-18. Members have until December 2016 to complete domestic approval processes and pay the initial tranche of their paid-in capital, according to the Philippines.
The Philippines will join countries such as Australia, Germany, Singapore, South Korea and the U.K., in signing the AIIB’s founding articles. In all, 57 nations are prospective founding members. The U.S. and Japan are notably absent.