China pushes regional development banks
Move is part of Beijing's plan to explore 'Silk Roads' and reform targets to expand economic clout, and is aimed at countering Japan's influence
China will set up regional development banks in Asia in the next few years to expand its economic clout and reduce Japan's influence.
The Communist Party, for the first time, has written the establishment of development banks into the communique released after the third plenum last month, which sets reform targets for the world's second-largest economy by 2020.
President Xi Jinping said at his meeting with Indonesian President Susilo Bambang Yudhoyono in October that Asia should have an infrastructure-dedicated bank to "promote interconnectivity and economic integration in the region".
Economists say China is expected to lead the foundation of one or a couple of development banks in the coming years as the country explores two "Silk Roads" to counter Japan's influence.
"The exploration of Silk Roads, financially backed by regional development banks led by China, has important political implications," said Liu Shanying, a researcher with the Chinese Academy of Social Sciences.
While China is in dispute with Japan over the sovereignty of the Diaoyu Islands and South China Sea, a westbound road from China to Central Asia, Middle East and eastern European countries, akin to the Silk Road of about 2,100 years ago, will reduce Japanese influence and facilitate trade and investment.
In case China's exports could not be shipped by sea because of a "deterioration in the safety situation in East Asia", the Silk Road will provide an alternate route, Liu said.
