China on Saturday officially launched the Asian Infrastructure Investment Bank (AIIB) which is seen as an emerging rival to powerful Western-led financial institutions such as the World Bank, the Asian Development Bank and the International Monetary Fund.
The AIIB – that had been formally established on last December - was launched in a lavish ceremony led by China’s Chinese President Xi Jinping.
The initiative is viewed as part of Beijing’s efforts to change the unwritten rules of global development finance.
The AIIB was created to invest in infrastructure projects in the Asia-Pacific region. In October 2014, the Articles of Agreement establishing the bank were signed by 21 states.
By mid-year, the agreement had been signed by 50 founding members in the financial organization. So far, 17 members have ratified the agreement.
Despite opposition from Washington, many US allies including Australia, Britain, German, Italy, the Philippines and South Korea have agreed to join the AIIB in recognition of China's growing economic clout.
Authorities have said that the bank aims to provide financial facilities for a chain of development projects including the construction of dams, ports, power plants and telecommunications networks across Asia.
The AIIB is headquartered in Beijing and its lean structure will be overseen by an unpaid, non-resident board of directors which, architects say, would save it money and friction in decision-making.
Seventy-five percent of AIIB’s shares are distributed within the Asian region while the rest is assigned among countries beyond it.
The AIIB is feared by the White House to be a new Chinese policy to increase the influence of the world’s second largest economy at regional and international levels.