Taiwan’s Absence from China-led Investment Fund Confirmed

Taiwan’s Absence from China-led Investment Fund Confirmed
Photo Credit:AP/ 達志影像

Translated and compiled by Yuan-ling Liang

On April 12, Taiwan Minister of Finance Chang Sheng-ford stated that Taiwan will not take part in the Asian Infrastructure Investment Bank (AIIB) because Chinese officials are requiring Taiwan to ask for permission from the PRC Ministry of Finance to join.

Chang says this condition could not be accepted because it disrespects Taiwan. However, he also says that cross-strait relations are expected to change after President-elect Tsai Ing-wen takes office, and the issue will be passed on to the new government.

Since last year, China President Xi Jinping has “invited” Taiwan to take part in the Beijing-based financial institution several times. The Chinese government stated in the past that “adequate measures" would be taken to guarantee Taiwan’s participation.

In January, after Taiwan’s presidential election, AIIB Bank Group President Jin Li-qun mentioned the “sovereignty clause” in the membership agreement of AIIB, saying that Taiwan “is not sovereign or responsible for the conduct of its international relations.” This statement raised discussion on whether the agreement would be used to refuse Taiwan’s application.

►Related News: Is The Sovereignty Clause Influencing Taiwan’s Attendance in AIIB?

On April 7, Jin confirmed that Taiwan is not qualified to apply for AIIB due to sovereignty concerns. He stated that Taiwan should apply through the PRC ministry, like Hong Kong.

Does Taiwan need to join AIIB?

Set up by China to integrate the capital and investments in the Asia-Pacific region, AIIB expects to promote the cooperation between Asian countries and boost their economies.

CommonWealth reports, since many Taiwanese companies are investing in southeast Asian countries and their emerging markets, joining AIIB is said to benefit Taiwan and some even believe this to be a way for Taiwan to grow closer to the ASEAN.

However, Roy Chun Lee, deputy executive manager of the Taiwan WTO and RTA Center, writes in an article posted by the Chung Hua Institution of Economic Research (CIER) that he doesn’t support Taiwan taking part in AIIB.

Lee says that Taiwan would benefit little since the island does not need investments to build its infrastructure. Also, looking at Taiwan’s past experience in Asian Development Bank (ADB), other than increasing the nation’s visibility, Taiwan did not benefit much.

GRI News reports, many experts believe that another reason Taiwan wouldn’t benefit from AIIB is the organization is mainly controlled by China. If Taiwan participates in AIIB, recovery of funds would be uncertain. Some speculate that this is also the reason the US hasn’t applied, and Taiwan should not be in such a rush. However, most Taiwanese still support applying to boost the visibility of the country.

Edited by Olivia Yang

Liberty Times Net
GRI News