MANILA, Philippines – The Philippines will officially join today the China-led Asian Infrastructure Investment Bank (AIIB) as its last member, the government announced yesterday.
“The Republic of the Philippines will be signing the articles of agreement of the Asian Infrastructure Investment Bank before year-end, joining the newly created multilateral institution aimed at boosting infrastructure development and connectivity,” the Department of Finance (DOF) said in a statement.
According to the DOF, Erlinda Basilio, Philippine ambassador to China, will sign the agreement on behalf of the Philippines today.
The authority was given last Tuesday, two days before the deadline for 57 prospective founding members to sign with the lender.
As a member, Manila will initially contribute $196 million to AIIB’s capital stock of $100 billion. The DOF said this would be payable in five years, equivalent to $39 million per annum.
The total stake will, however, be worth $979.1 million using AIIB’s metrics, with the rest of the amount being contributed only when needed. The total represents 0.010 percent stake in the bank.
In terms of voting power, the Philippines will get 12,821 votes, equivalent to 1.11 percent of AIIB membership, according to the DOF.
To compare, the country has 2.21 percent voting share in the Japan-chaired Asian Development Bank, and 0.45 percent in the US-led World Bank. The US and Japan have opted out of AIIB.
“The Philippines has taken the matter of our membership in AIIB very seriously. We have participated in the discussions leading to its creation, believing that good governance is just as important in our international institutions just as they are,” Purisima said.
“We are confident the bank’s organization design and oversight mechanisms are committed to transparency, independence, openness, and accountability,” he said.
Days before the deadline, there was little sign the Philippines will join AIIB after Aquino voiced out concerns the bank will may be used by China for its political agenda.
It also did not help that the Permanent Court of Arbitration at the Hague recently ruled it has jurisdiction to hear the Philippines’ case against China in the West Philippine Sea. Beijing has denounced the hearings and would not participate.
“The Philippines stands to gain from signing on as a founding member. We can look forward to deepening our country’s technical expertise in infrastructure as we expand bankable projects,” Purisima said.
“(We) may foresee market expansion for infrastructure-related industries, widening job and business growth opportunities,” he added.
The AIIB agreement came into force on Christmas Day upon ratification by 17 countries accounting for 50.1 percent of the bank’s stake. Other members have until December 2016 to follow suit.