World Bank president Jim Yong Kim confirmed that he does not regard the China-led initiative to set up the Asian Infrastructure Investment Bank (AIIB) as a threat to existing institutions such as his own bank and the Asian Development Bank (ADB).
“We have a need for so much infrastructure, we would welcome any new player,” said Kim, who was addressing a forum in Washington DC. Kim had previously signalled his openness to the proposed AIIB, this was his most extensive and explicit comment to date.
He added that the Washington-based World Bank was also ready to work with the ‘New Development Bank’, established last year by the so-called ‘BRICS’ countries of Brazil, Russia, India, China and South Africa.
“We estimate that the world needs an additional [US$1 trillion to US$1.5 trillion] every year to be invested in infrastructure,” Kim told an audience at the Centre for Strategic and International Studies. “I will do everything in my power to find innovative ways to work with these banks.”
He also said that the World Bank has a strong relationship with Beijing and had dialogue with Chinese officials as the AIIB was developed. Chinese officials say they hope to have the bank’s charter written and in place by the end of this year.
Both the US and Japan have remained aloof as other major economies applied to become founder members of the AIIB. They include Australia, which initially was also reluctant to join. US officials maintain that the bank, backed in part by US$50bn funding from China, could duplicate work being done by existing multilateral lenders, while undercutting international efforts on such issues as the environment and anti-corruption measures.
However, Kim commented; “Fundamentally the issue is poverty, so your enemy can’t be other institutions. The enemy is poverty.
“The decisions we make this year, and the alliances we form with other institutions in the years ahead, will help determine whether we have a chance to reach our goal of ending extreme poverty in just 15 years.”
Kicking off day two of the Singapore Fintech Festival, Deloitte Chairman David Cruikshank said that fintech is significant for three reasons. First, customer expectations of services are higher than ever. Second, barriers to entry are lower than before. And finally, financial institutions (FIs) face a threat of what a competitor might do.
Technology will drive the innovation in banking: Damian Richardson, head of payments strategy & innovation at NatWest
At this year's Sibos conference in Toronto, digital finance reporter, Alara Basul, sat down with Damian Richardson, head of payments strategy and innovation at NatWest to discuss how technology is driving innovation in banking.
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