China takes up IDB membership
Published: Wednesday | January 14, 2009
The IDB had approved its entry last October, which Chinese ambassador Zhou Wenzhong said came after more than a decade of lobbying for inclusion.
"Today is an exciting day when, after 15 years of efforts, China becomes a formal member of the Inter-American Development Bank group," said Zhou. "China's accession to the IDB will create a new platform and opportunity to boost China-Latin American cooperation, hence a win-win choice for both sides."
China does US$110 billion of trade with Caribbean and Latin American countries, and is the region's second largest trading partner behind the United States.
With its addition, IDB membership now spans 40 per cent of the world's population and nearly three-quarters of its GDP.
The Asian giant and the world's most populous nation with 1.3 billion people enters the IDB as 48th member and a lender, infusing US$350 million of capital which will fund various programmes.
Under the agreement China has acquired 0.004 per cent or 184 shares in the bank, and was granted a seat on the board of governors, the IDB's top decision making body.
The bank's 26-member borrowers own 50.01 per cent.
Additional capital
The additional capital for Latin American and Caribbean countries comes as "the IDB is striving to assist its borrowing member countries to deal with the impact of the global financial crisis," the bank said. Regional economic growth is projected to slow to around two per cent this year, its lowest level in six years, said IDB.
In the past year, the bank has lent or granted countries some US$12.2 billion for projects and programmes. It also disbursed US$900 million of a special $6 billion liquidity support fund that governments can access in a crunch.
"China's welcome addition to the IDB family will further strengthen our institution at a critical moment for the world economy, when countries need to protect recent social and economic gains," said IDB president Luis Alberto Moreno.
"These challenging times require bold and unified actions that will be a key part of the agenda .... China is an essential partner in the road ahead."
The signed documents will be deposited in the Organisation of American States (OAS), the founding institution of the Inter-American system, said the IDB. China has observer nation status at the OAS.
business@gleanerjm.com
How China's US$350m will be spread
| US$125m | Fund for Special Operations, the IDB's soft- | loan window for its poorest member countries. | ||
| US$75m | To create a multi-donor fund to strengthen | the institutional capacity of LAC countries. | ||
| US$75m | For a new Inter-American Investment | Corporation fund for investment capital to SMEs | ||
US$75m | For the Multilateral Investment Fund.
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