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| South Korea Says It’ll Join Regional Development Bank Led by China | South Korea Says It’ll Join Regional Development Bank Led by China |
| (about 7 hours later) | |
| SEOUL, South Korea — South Korea on Thursday became the latest American ally to announce its intention to join the Asian Infrastructure Investment Bank despite Washington’s qualms about the Chinese-led regional development bank. | |
| The South Korean Ministry of Strategy and Finance said in a statement that Asia needed a new regional source of development money like the Asian Infrastructure Investment Bank because the existing multilateral lenders, like the World Bank and the Asian Development Bank, could not meet the demand for infrastructure investment funds in the region. | |
| The United States has expressed misgivings about the proposed regional lender, which it sees as a threat to the Washington-led World Bank. American officials have also worried that the new bank would lack governance and transparency in enforcing lending, environmental and labor standards. | The United States has expressed misgivings about the proposed regional lender, which it sees as a threat to the Washington-led World Bank. American officials have also worried that the new bank would lack governance and transparency in enforcing lending, environmental and labor standards. |
| But in its statement, the South Korean ministry said that a founding membership in the regional bank would help expand the country’s influence in the international banking sector. It also said membership would help its companies win deals in large-scale construction, telecommunications, transportation and other development projects in the region. | But in its statement, the South Korean ministry said that a founding membership in the regional bank would help expand the country’s influence in the international banking sector. It also said membership would help its companies win deals in large-scale construction, telecommunications, transportation and other development projects in the region. |
| “Our government, together with its allies, has been urging China to improve its plans for the bank so that its governing structure and safeguards will meet international standards,” the ministry said. “We have seen significant progress in that regard.” | “Our government, together with its allies, has been urging China to improve its plans for the bank so that its governing structure and safeguards will meet international standards,” the ministry said. “We have seen significant progress in that regard.” |
| The question of whether to join the bank has presented South Korea with a tricky balancing act between the United States, its most important security ally, and China, its largest trading partner. | The question of whether to join the bank has presented South Korea with a tricky balancing act between the United States, its most important security ally, and China, its largest trading partner. |
| Australia, Japan and South Korea — all important American allies in the Asia-Pacific region — have been notably absent from plans for the Asian Infrastructure Investment Bank. | |
| Australia’s prime minister, Tony Abbott, said on Wednesday that he supported the proposed bank as long as it was transparent and not dominated by a single country. Japan also said it was reviewing its options. | Australia’s prime minister, Tony Abbott, said on Wednesday that he supported the proposed bank as long as it was transparent and not dominated by a single country. Japan also said it was reviewing its options. |
| In South Korea, support for membership grew after Britain, France, Germany and Italy said they would join the development bank. More than 20 countries have said they will become members. | In South Korea, support for membership grew after Britain, France, Germany and Italy said they would join the development bank. More than 20 countries have said they will become members. |
| China, which has pledged to provide a large share of the bank’s initial capital, proposed the bank in part to increase its influence in global finance. The bank has the goal of starting with $50 billion in capital, and China is expected to be a major stakeholder. | China, which has pledged to provide a large share of the bank’s initial capital, proposed the bank in part to increase its influence in global finance. The bank has the goal of starting with $50 billion in capital, and China is expected to be a major stakeholder. |