Korea becomes fifth largest shareholder of AIIB

Asian Infrastructure Investment Bank, a new international financial institution led by China, has completed its launch preparations.

The Chinese government held a signing ceremony of Articles of Agreement on AIIB on Monday in Beijing. Among the representatives of all 57 founding members attending, 50 signed who had completed their domestic procedures. The remaining will be signing within the year-end. The Articles of Agreement will officially go into effect when at least a stake of 50 percent and more than 10 countries complete domestic ratification procedures. The China-led bank is likely to be inaugurated by the year-end.

Korea`s finance minister Choi Kyung-hwan who joined the ceremony as Korea`s representative said Sunday at a briefing session, "If North Korea needs investment and secures investment conditions Korea has no reason to oppose AIIB`s support of North Korea," adding, "I will make efforts to push through projects related to the government`s `Eurasia Initiative` project as one of AIIB`s businesses."

According to AIIB Articles of Agreement, China became the largest shareholder within the bank with a 30.34 percent in stake and 26.06 percent of the total votes. China will have de facto veto power over important decisions made by the bank, including support for non-members, change in equity capital, size of board of directors, revision of the Articles of Agreement, etc.) as it will have more than 25 percent of the total voting rights in the AIIB based on its contribution.

The bank will be headquartered in Beijing and its first chief is highly likely to be Chinese. Korea has a 3.81 percent in stake in AIIB and 3.5 percent of the total votes, ranking fourth in the region (Asia and Oceania), and fifth in overall ranking. Korea received 3.74 billion dollars in initial capital, and will pay 750 million dollars in installments over the next five years. The AIIB will launch with initial capital of 98.2 billion dollars as some member countries have given up their stakes.