Countries from five continents formally signed up yesterday to the China-led Asian Infrastructure Investment Bank (AIIB) — a potential rival to the Washington-based World Bank — as Beijing steps up its global diplomatic and economic role.
Australia was the first country to sign the Articles of Agreement creating the AIIB’s legal framework at a ceremony in Beijing’s Great Hall of the People, an Agence France-Presse journalist saw, followed by 49 other founding members. Seven more are expected to do so by the end of the year.
The bank will have a share capital of US$100 billion, with US$20 billion paid in initially, the document showed.
The signing “is an embodiment of the concrete action and efforts made by all countries in the spirit of solidarity, openness, inclusion and cooperation,” Chinese President Xi Jinping (習近平) said after the ceremony.
Signaling China’s central role at the bank, he added: “Now we are willing to listen to your views and proposals.”
The AIIB has been viewed by some as a rival to the World Bank and the Asian Development Bank, and the US and Japan — the world’s largest and third-largest economies respectively — have notably declined to join.
Earlier this month, former US Federal Reserve chairman Ben Bernanke rebuked US lawmakers for effectively encouraging the AIIB’s formation by blocking reforms giving developing nations a greater say in the IMF.
Beijing will be by far the largest AIIB shareholder at about 30 percent, the articles of association posted on the Web site of China’s Ministry of Finance showed. India is the second biggest at 8.4 percent, and Russia third with 6.5 percent.
The voting structure gives smaller members a slightly disproportionately larger voice, and a statement accompanying the articles said China will have 26 percent of the votes.
That is not enough to give Beijing a formal veto over all the bank’s decisionmaking, but it will still have an outsized say and a block on some votes that require a 75 percent majority — including the choice of the bank’s president, suspensions of members and changes to the rules.
“China’s shareholding and its voting power at the establishment of the AIIB is a natural result led by the rules decided by all members,” former Chinese vice minister of finance Shi Yaobin (史耀斌) said, according to Xinhua news agency.
“China is not deliberately pursuing the veto power,” he added, saying share percentages could be diluted by future new admissions.
Among non-Asian participants, Germany is the largest shareholder with 4.5 percent, followed by France with 3.4 percent and Brazil with 3.2 percent.
The AIIB is expected to go into operation later this year and its headquarters will be in Beijing, despite calls from Indonesia that it be based in Jakarta.
However, all financial terms in the agreement are in US dollars, rather than the Chinese yuan, and the bank’s working language will be English.
Only 50 of the 57 countries that have applied for founding membership signed up in Beijing yesterday, and the Ministry of Finance said the remainder — Denmark, Kuwait, Malaysia, Philippines, Poland, South Africa and Thailand — have yet to ratify the necessary agreements.
Semiconductor stocks on Friday took a beating after a grim profit warning from Idaho-based Micron Technology Inc sparked fresh worries about the US’ earnings power as the country is potentially heading for a recession. Despite a broader stock market rally, the Philadelphia Stock Exchange Semiconductor Index dropped 3.8 percent after Micron, the largest maker of memory semiconductors in the US, flagged that demand was cooling for chips used in computers and smartphones. The index — which is home to US chip giants Advanced Micro Devices Inc and Nvidia Corp, as well as Micron — is down 38 percent this year. Historically, semiconductor
WHOLLY OWNED SUBSIDIARY: Costco Wholesale said it expected the purchase of the remaining 45 percent stake to add 1 to 1.5 percent to its earnings per share US-based Costco Wholesale Corp on Thursday said that it had purchased the remaining 45 percent stake in Costco President Taiwan Inc (台灣好市多) for US$1.05 billion, making the local company a fully-owned unit. “We estimate that the purchase would add about 1 to 1.5 percent to [our] earnings per share,” Costco said in a statement. Costco President Taiwan was established as a joint venture with Kaohsiung-based President Group (大統集團), which held a 45 percent stake. Since the first Costco store opened in Kaohsiung in 1997, 14 outlets have been set up in Taiwan, company data showed. PROFITABLE Three Costco stores in Taiwan — in Taipei’s Neihu
MOBILITY SOLUTIONS: Tata Technologies’ participation marks more progress in Hon Hai’s efforts to expand its ecosystem through the platform, the Taiwanese firm said India’s Tata Technologies Ltd has become the latest member of Hon Hai Precision Industry Co’s (鴻海精密) MIH Open Platform to jointly develop sustainable mobility solutions for customers worldwide, the Taiwanese company said yesterday. It might include embedded and electrical, electric platform development and battery management system solutions, among others, Hon Hai said. Tata Technologies’ participation marks more progress in Hon Hai’s efforts to expand its electric-vehicle (EV) ecosystem through the MIH platform, it said. The open platform has about 2,380 members around the world, with an aim to jointly develop EV ecosystems and shrink the time to market for products. Hon Hai made the
SOARING PROFITS: Semiconductors and shipping have knocked automaking and construction out of the 10 highest paying industries, stock exchange data showed Mobile phone chip designer MediaTek Inc (聯發科) posted an average of NT$5.15 million (US$173,249) in annual compensation for non-managerial employees last year, marking the highest among all firms listed on the Taiwan Stock Exchange (TWSE), exchange data showed. That is a 66 percent increase from the company’s average compensation of NT$3.08 million in 2020, as its earnings per share (EPS) expanded from NT$26.01 in 2020 to NT$70.56 last year. That is also three times higher than the average compensation of NT$1.7 million in the nation’s semiconductor industry, the data showed. The increases helped MediaTek advance its ranking from third in 2020, replacing