Advertisement

China-led development bank starts with $509M in loans for 4 projects

 
Published June 26, 2016

BEIJING — A new Chinese-led international development bank announced its first four loans Saturday, pledging to lend $509 million for projects to spread electric power in rural Bangladesh, upgrade living conditions in slums in Indonesia, and improve roads in Pakistan and Tajikistan.

At the first of the annual general meetings of the institution, the Asian Infrastructure Investment Bank, the bank's president, Jin Liqun, said the projects were financially sound and environmentally friendly.

The projects of the 57-member bank, founded last year as an effort by China to both challenge lending institutions and cooperate with them, are relatively modest.

The road in Tajikistan is just 3 miles long, but it will help clear traffic congestion on an important trading route near the capital, Dushanbe. A $100 million loan to Pakistan is for 40 miles of highway in Punjab province that would complete the last section of a national artery, the bank said.

Three of the projects are being financed with other institutions — the Asian Development Bank, the World Bank and the European Bank for Reconstruction and Development — an approach that allowed the new bank to begin the projects quickly. The bank's $165 million loan to expand electricity in rural areas of Bangladesh is its only stand-alone project.

The new bank is being watched closely. The United States refused to join when it was offered membership in 2014, saying it was uncertain how the bank would measure up on matters of environmental protection, human rights and anticorruption measures long promoted by Western governments and institutions.