MANILA (UPDATE) - President Aquino has approved the recommendation of the Department of Finance (DOF) that the Philippines join the Beijing-led Asian Infrastructure Investment Bank (AIIB), Finance Secretary Cesar Purisima said Wednesday.
The AIIB, which has become one of China's biggest foreign policy successes, has been formally established and is expected to be operational early next year.
AIIB will co-exist and may compete with Washington-backed World Bank and Tokyo-led Asian Development Bank (ADB).
But Purisima believes the AIIB "will augment and complement existing multilateral institutions in accelerating economic growth."
“Our shared pursuit of growth and development has only become more challenging as the global environment becomes increasingly complex. We thus welcome platforms where countries can work towards shared development goals in the spirit of partnership,” Purisima said.
Chinese Foreign Ministry spokesman Lu Kang said he needed to verify whether the Philippines was indeed joining, but if it was true, it was a good thing.
Southeast Asia's fifth-largest economy requires $127 billion from 2010 to 2020 to finance its infrastructure needs, the Asian Development Bank has projected.
Founder members will initially pay 20 percent of AIIB'S $100 billion authorized capital. The Philippines' indicative paid-in capital is $196 million, the Department of Finance said.
Manila is embroiled in territorial disputes with Beijing over some islands in the South China Sea. The Philippine has challenged Beijing before the arbitration court in the Hague, a case Beijing has not recognized.
Asked whether the South China Sea dispute could affect the Philippines' membership or ability to get funding from the AIIB, Lu said: "The AIIB's operations will follow the charter agreed on by all AIIB members by consultation." -- With Reuters