Asian Infrastructure Investment Bank (AIIB) will help Bangladesh bring about a revolutionary change in regional connectivity through local infrastructure development, observed economists and entrepreneurs, hailing the government's initiative to join the specialized bank.
Bangladesh is a signatory to a deal inked on October 24 in Shanhai, a commercial hub of China, by representatives from 21 Asian nations to set up the bank. The bank will lend money to build roads, mobile phone towers and other forms of infrastructure in poorer parts of Asia. China spearheaded the bank, considering the fact that Asia has a massive infrastructure-funding gap, and hopes to formally launch it by the end of next year.
The hole at some $8 trillion between 2010 and 2020 was pegged by Asian Development Bank (ADB). However, the existing institutions cannot hope to fill it; ADB has capital based money--both paid-in and pledged by member-nations of just over $160 billion-- and World Bank has $223 billion.
The new bank, AIIB, will start with $50 billion in capital, barely enough for what is needed but still a helpful boost. Moreover, while ADB and World Bank loans support everything from environmental protection to gender equality, the AIIB will concentrate its firepower on infrastructure, Chinese officials said.
Professor MM Akash of Dhaka University said, "China, with its huge accumulated resources, will use the new bank to expand its influence and establish power in Asian region which, otherwise, is dominated by Japan and the USA."
The country's apex trade body chief lauded Bangladesh's joining the new bank.
"This is a perfect and time-befitting decision of Prime Minister Sheikh Hasina," said Kazi Akramuddin Ahmed, President of Federation of Bangladesh Chambers of Commerce and Industry (FBCCI).
Development of the Dhaka-Chittagong four-lane highway and capacity building programme of seaports were delayed due to fund crisis, FBCCI chief pointed out, suggesting that cooperation of the AIIB could be sought to go ahead with such projects, which obviously help Bangladesh keep business on right track.
Md Atiqul Islam, President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said Bangladesh will be the No. 1 apparel exporter in the globe if the country can improve infrastructures.
"People of the country will obviously be benefited by the decision of the government to join the AIIB, aiming at contributing to infrastructure development," Islam said.
World Bank President Jim Yong Kim has also welcomed the AIIB, saying that need for infrastructure in developing countries is great, so the new organization would benefit them,
Pointing his finger at 'huge infrastructure financing needs' in Asia, ADB President Takehiko Nakao said establishment of the AIIB is an understandable step.
He said when AIIB is established, ADB will be willing to consider appropriate collaboration and, at the same time, urged that AIIB adopt international best practices in such areas as procurement and social safeguards on lending arrangements.