China’s leaders pledged their full support for the newly launched Asian Infrastructure Investment Bank (AIIB)and called on other international development lenders to help improve the region’s infrastructure and create jobs. President Xi Jinping said at the opening ceremony yesterday that China would also contribute US$50 million to a fund planned by the bank to support infrastructure construction in under-developed countries. He added that China was committed to devoting itself to the operation of the bank. Premier Li Keqiang said in a later speech that the AIIB was a milestone in reforming global economic governance. The bank was first proposed by Xi in October, 2013, when China’s economy was still resilient and Beijing was seeking new ways to spend its growing foreign exchange reserves. Much has changed since then. China’s foreign exchange reserves are shrinking rapidly as investors turn bearish on prospects for the country’s currency. Allegations that Beijing has mishandled its governance of stock markets amid falling share prices in the past months has also raised fresh concerns about its ability to manage its economy. Li, however, used his speech to defend the country’s economic record, saying that China’s gross domestic product grew about 7 per cent last year. The unemployment ratio was lower than expected while job creation also beat expectations. Services accounted for half of GDP and consumption contributed nearly 60 per cent of economic growth, he said. Xi and Li said the AIIB would supplement existing multinational development agencies and called for cooperation to increase financing for “high-quality and low-cost” infrastructure construction in Asia. READ MORE: China-led Asian Infrastructure Investment Bank just months away from first loan They also encouraged the AIIB and other lenders to get involved in the One Road, One Belt initiatives that aim to improve China’s trade and infrastructure links to Asia and beyond. The bank elected China’s Finance Minister Lou Jiwei chairman of the AIIB council Jin Liqun its first president. It is expected to launch its first loans by mid-2017. Beijing indicated that it would not apply for loans from the bank initially as its neighbours had more urgent needs. “The AIIB has already received a lot of potential projects applying for funds, from South Asia to Central Asia,” said Wang Wen, executive dean of the Chongyang Institute for Financial Studies at Renmin University. Joint funding of projects was likely to take place with the Asian Development Bank, the Manila- based institution’s vice president Stephen Groff said. Jin, the AIIB president, wrote in People’s Daily earlier this month that the bank would invest in digital infrastructure and help developing member states improve internet networks and related infrastructure. Many AIIB members were keen to develop better broadband, mobile networks and satellite coverage, Jin said. He added that other projects the AIIB would finance included the transport sector, power grids, oil and gas pipelines, energy schemes including nuclear power, logistics, and water supply and drainage. Xiong Aizong, a researcher at the Chinese Academy of Social Sciences, said “the first batch of projects will be key to the bank’s onward operation so it must choose its targets very carefully”.