China received critical support from the International Monetary Fund (IMF) and Asian Development Bank (ADB) on Sunday for a new Chinese-led multilateral lender.

Leaders of the IMF and ADB, speaking at a conference in Beijing, said they were in talks with or happy to cooperate with the Asian Infrastructure Investment Bank (AIIB), a $50 billion lender to be majority funded by China.

The United States has urged countries to think twice about signing up and questioned whether the AIIB will have sufficient standards of governance and environmental and social safeguards.

Some 27 countries have already signed up to participate in the AIIB, China's Finance Minister Lou Jiwei told China National Radio on Saturday. It will provide project loans to developing countries and is slated to begin operations at the end of this year.

The United States' key strategic allies in the region, Australia, Japan and South Korea, are also considering joining the proposed Beijing-based bank.

Early opposition to the AIIB from Western countries partially dissolved after Britain said this month it would join, with France, Germany and Italy swiftly following suit.

Canberra could formally decide to sign up to the AIIB when the full cabinet meets on Monday, Australian media have said.

At least eight more countries may join by the March 31 deadline, Jin Liqun, secretary-general of the interim secretariat establishing the AIIB, told a panel at the conference.

The fund will have approval from its shareholders at the start to double its capitalization to $100 billion, he said.

"China will follow the rules of the international community and will not bully other members but work together with them and try to reach consensus in all the decisions we make without brandishing the majority shareholder status," he said.

China's official Xinhua news agency suggested in an editorial that the United States might be embarrassed that many of its allies had not heeded its warnings.

"Decision-makers in the United States really have to be reminded that if they do not jump on the bandwagon of change in time, they will soon be overrun by the bandwagon itself," it said.

IMF Managing Director Christine Lagarde said the fund would be "delighted" to cooperate with the AIIB.

China's Lou and ADB President Takehiko Nakao said at the conference they had held discussions on possible cooperation, with the Chinese finance minister adding that topics discussed included safeguard standards.

Lou has previously said AIIB would complement rather than compete with other institutions such as the ADB, the Manila-based multilateral lender dominated by Japan and the United States.

The AIIB's Jin said developing countries in Asia would receive the bulk of loans for infrastructure projects, which could be co-provided with commercial banks and pension funds.

Non-Asian countries would also only hold 25 percent of the AIIB's shareholding, lower than their stakes at the founding of the ADB, he said.
(China Daily)