— This is the script of CNBC's news report for China's CCTV on March 24, Tuesday.
Welcome to CNBC Business Daily, I'm Qian Chen.
Global institutions have endorsed a China-led international bank, despite opposition from the U.S., including the International Monetary Fund (IMF) and the World Bank.
With $100 billion capital amounts, Asian Infrastructure Investment Bank (AIIB) is being established to meet the need for greater infrastructure investment in lower- and middle-income Asian countries. It comes amid complaints by China and other major emerging economies that they lack influence in institutions such as the IMF, the Asian Development Bank and the World Bank.
Support for the AIIB has gathered speed in Europe this month, with the U.K. the first country to sign up, followed by Germany, France and Italy and then Luxembourg and Switzerland.
However, Washington has expressed misgivings, officially because of concerns about standards of governance and environmental and societal safeguards. Unofficially, the country's is thought to be worried about sacrificing its clout in Asia to China, as well as piqued by criticism of slow reforms in the IMF and World Bank.
[David Lipton, the First Deputy Managing Director, IMF] "We're comfortable with the idea of a bank that puts together the finance for infrastructure 125706 cause our view, is that there is a huge need for infrastructure in emerging market countries, in developing market countries, after all the G20 has talked for the last 20 years about how to encourage infrastructure and how to provide finance."
"China is now the leader of the world," Sri Mulyani Indrawati, managing director of the World Bank, told CNBC in Beijing.
Indrawati said the World Bank will collaborate with AIIB closely.
[Sri Mulyani Indrawati, World Bank MD] "The Asia is very very big. you are talking about 1 trillion, for Asia (each year needs) around 700 billion. So, any institution, development institution like the bank, the Asian development bank, they don't fill the gap alone. So we really welcome from the beginning. Last year, president Jim Yong Kim welcomed this idea to have this institution to established. And we will even work very closely with them."
Jim McCaughan, CEO of Principal Global Investors, said that China's move was part of a bid to establish the yuan as a global currency and that the U.S. might be more positive towards the AIIB then its official statements suggested.
[Jim McCaughan, CEO of Principal Global Investors] "I thine Washington will collaborate, I don't think Washington will join in, but they will collaborate at least behind the scenes. This infrastructure bank is a part of bigger picture as far as China concened. Ultimately, the chinese policy makers, econo policy makers, I believe, are pushing the idea of renminbi as a reserve policy. but there're lots of things they have to do on the way. And this is one small step on that direction -- having a multinational institution that they can lead."
CNBC's Qian Chen, reporting from Singapore.