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U.S. at odds with U.K. decision to join China-funded bank

The U.S. National Security Council has spoken out against the new financial institution and sees it as a competitor to international organizations like the World Bank.

By Elizabeth Shim
U.S. at odds with U.K. decision to join China-funded bank
The U.K. has applied to join a China-funded bank as a founding member, but the U.S. has raised concerns of the bank's commitment to international standards of governance. File Photo by UPI/Stephen Shaver. | License Photo

BEIJING, March 13 (UPI) -- The United States is raising concern over British backing of a bank that will be jointly funded with China and 20 other countries.

The Asia Infrastructure Investment Bank is seen as a competitor with organizations like the World Bank in its mission to finance energy and infrastructure projects in the Asia-Pacific region, the BBC reported.

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The U.S. National Security Council has spoken out against the bank, questioning the bank's dedication to international standards. The U.S. has requested regional allies Australia, South Korea and Japan to stay out of the bank.

England's decision to support the Asia Infrastructure Investment Bank, as a founding member, has been met with disappointment by Americans.

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If Britain's application is approved they will join Singapore, India and Thailand as a founding member of the new institution. The move could position London between China and the United States, two of the world's largest economies.

The World Bank's president however welcomed the new bank because of its stated support to Asian infrastructure spending.

But the bank would place China's shareholding at 67 percent, giving the country the most clout in investment and financing decisions.

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British veto power within the bank also could be limited.

The Asia Infrastructure Investment Bank was created by Beijing to offer an alternative to the Asian Development Bank that's primarily funded by Japan and the United States.

The Financial Times reported that the bank was designed to provide a counterweight to the ADB, rather than pose a threat to the World Bank or the IMF. China spearheaded the bank in response to what the country perceives as the dominating influence of the United States and Japan in the region.

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