Japan could join China-led Asian bank by June

March 31, 2015 04:59 pm | Updated November 16, 2021 06:55 pm IST - BEIJING

Bowing to pressure from its powerful business groups, Japan could join the China-led Asian Infrastructure Investment Bank (AIIB) in the next few months, deserting the United States — Tokyo’s foremost post-war ally, says a media report.

The Financial Times , quoting Japan’s ambassador to China, Masato Kitera is reporting that Tokyo would sign up to the AIIB by June, missing the March 31 deadline for applying as a founder member of the lender. “The business community woke up late, but now they have mounted a big campaign for the AIIB which appears to be very effective,” Mr. Kitera was quoted as saying.

But in Tokyo, the FT report evoked an ambivalent response. Japan’s Chief Cabinet Secretary Yoshihide Suga said on Tuesday that ambassador had not made any such comment and Japan's position on the AIIB was unchanged. “I have been informed that it is not true that Ambassador Kitera made such remarks forecasting (Japan's) participation,” Mr. Suga told a news conference. But he added that, “I think it's impossible for Japan to take part today,” not ruling out a reversal of position later.

Reuters quoted an unnamed Japanese government source as saying, “We have not ruled out the possibility of either joining or staying out.” In Beijing, Chinese Foreign Ministry spokesperson, Hua Chunying said

on Tuesday that Japan was welcome to join the bank, but Tokyo would have to take the call. “As for whether or not Japan is willing to participate, we have previously said that we welcome all countries to proactively participate,” she observed. She added China would respect the wishes of any country “whether or not they join or when they decide to join.”

According to FT , a group of Mitsubishi Group executives based in China have offered support during their meeting this month with Jin Liqun, who has been designated to run the infrastructure bank. The Japanese

find Mr. Jin, a familiar face, because of his position as a senior official at the U.S. and Japan backed Asian Development Bank (ADB). The Japanese industrial houses see participation as beneficial, as the AIIB will be at the heart of building infrastructure in the region, offering substantial business opportunities. Besides, collaboration with the Chinese could help mend frayed ties between Beijing and Tokyo, highlighted by a dispute on a group of islands in the East China Sea.

Analysts say that over time, the U.S. could change its position towards the new bank. However, on Monday, visiting U.S. Treasury Secretary, Jack Lew said in Beijing that Washington still had its concerns about the standards that the AIIB would maintain. “We very much welcome China’s increased participation in infrastructure investment, and the concerns we've raised about the needs for standards continue,” Mr. Lew said. He added: “The initial decisions of what kinds of projects are invested in will obviously be a very important signal as to how they’ll proceed.”

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