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US official pushes for IMF reform, praises AIIB

Updated: 2016-10-19 09:23
By Chen Weihua in Washington (chinadaily.com.cn)

"Emerging markets comprise an increasing share of the global economy, and we should incentivize them to embrace greater responsibility to contribute to global economic prosperity through cooperative policies,"

Sheets dismissed the saying that the US saw institutions such as the China-led Asian Infrastructure Investment Bank (AIIB) as a threat to US influence in the international financial system.

"But we have been clear that the United States stands ready to welcome new institutions into the international architecture, provided that they share the international community's strong commitment to sound governance principles and high social and environmental standards," he said.

The US government has drawn sharp criticism from both home and abroad early this year for its efforts to dissuade its allies, such as United Kingdom, Australia and South Korea, from joining the AIIB. The efforts, which failed, have been attributed by former US Treasury Secretary Larry Summers as the fact that the Congress would not grant the money needed for US to join AIIB.

Sheets acknowledged on Tuesday that there is huge infrastructure need in Asia. "As the AIIB takes constructive step to address that. That's good for global growth," he said.

He said that the documents that have been prepared for AIIB seem broadly in line with international standards. He also described as "encouraging signs" that the first round of AIIB projects has been either co-financed with other developing banks or have been in consultations with them.

The AIIB board meeting in late June approved $509 million in investments for four projects, including three projects co-financed with the World Bank, the Asian Development Bank, the United Kingdom Department for International Development and the European Bank for Reconstruction and Development.

The projects are to improve power grid in Bangladesh, slum renovation in Indonesia and highway construction in Tajikistan and Pakistan.

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