JOHANNESBURG (miningweekly.com) – Iron-ore miner Fortescue Metals has welcomed Treasurer Joe Hockey’s announcement on Wednesday that Australia would become a founding member of the Asian Infrastructure Investment Bank (AIIB).
Hockey has committed to contributing A$930-million as paid-in capital to the bank over the next five years, making Australia the sixth-largest shareholder in the Beijing-based organisation designed to help finance infrastructure projects across Asia. The AIIB will have paid-in capital of $20-billion with total authorised capital of $100-billion.
Fortescue CFO Stephen Pearce commented that Australia’s involvement in the AIIB was a positive step in furthering economic ties with China and other countries in the region.
"China has laid out a strong roadmap for the decades ahead through its visionary $140-billion Belt and Silk Road Plan. The AIIB will provide critical investment funds for this transformative infrastructure plan for the benefit of the entire region, and it is encouraging to see that Australia will have a role as a founding member.
"We see a bright outlook not only for China, but also for other emerging economies in the Asian region as the urbanisation and industrialisation journey continues. A strong regional financial institution will be an important building block for this exciting future,” Pearce said in a statement.
There was an estimated infrastructure financing gap of about $8-trillion in the Asian region over the current decade and the AIIB would be part of the solution to closing the gap.
Hockey said that the AIIB would work closely with the private sector and that it would pave the way for Australian businesses to take advantage of growth in infrastructure in the region.
The AIIB was expected to be operational by the end of the year, Hockey said.