General Assembly OKs infrastructure bank, development bank, both based in China

The UN General Assembly granted observer status to two development banks, both headquartered in China, on Thursday, a move that experts believe will "promote their cooperation with the UN".

In two separate resolutions adopted by the assembly, the Asia Infrastructure Investment Bank (AIIB) and the New Development Bank (NDB), initiated by China and the BRICS countries respectively, became observers to the UN's most inclusive body.

"By becoming an observer, we will be able to work more closely" with the UN, said Gerard Sanders, general counsel of the AIIB.

"We will have better and more timely information about what the UN is thinking of the issues of importance to the AIIB, and hopefully we will be able to make some modest contribution to the work of the UN over time," he added.

Initiated by China in 2014, the AIIB is a multilateral development bank with a mission to improve social and economic conditions in Asia. Headquartered in Beijing, it began operations in January 2016 with 57 founding countries and has since grown to 93 approved members worldwide.

Over its two and a half years of operation, the AIIB has reached cooperative arrangements and co-financed development projects with a number of international development organizations, including UN specialized agencies and regional development banks.

Sanders said the bank's charter recognizes the need to work with other institutions that have "a best interest in development", both in terms of forming policy objectives and delivering individual projects.

"To date, we have been focusing very much on financial institutions, but the UN is really the key body that is concerned with development, and so it's important we have an association with them," he said.

The NDB is a multilateral development bank established by the BRICS countries — Brazil, Russia, India, China and South Africa — in 2014.

Headquartered in Shanghai, the NDB mobilizes resources for infrastructure and sustainable development in the BRICS countries and other emerging economies and developing countries, complementing the existing efforts of multilateral and regional financial institutions for global growth and development.

Ma Zhaoxu, China's permanent representative to the UN, believes that through their new status, "the two banks are in a better position to communicate and cooperate with the UN and contribute to achieving the sustainable development goals set by the world organization."

As the country involved in initiating the two banks, China shepherded the submission of the draft resolutions and led the effort toward their adoption.

"The process has demonstrated China's determination and commitment to adhere to multilateralism and implement the 2030 Sustainable Development Agenda of the UN," said Ma.

"There is no doubt that the General Assembly's granting of observer status to AIIB will further enhance its cooperation with entities in the United Nations system and its contribution to implementation of the 2030 Agenda for Sustainable Development in general," Liu Kun, China's minister of finance, wrote in a letter to UN Secretary-General Antonio Guterres in July.

In addition to its 193 member states, the UN General Assembly may grant observer status to an international organization, entity or non-member state, which entitles the entity to participate in the work of the assembly, though with limitations. Currently, there are more than 100 UN observers.

Previously, the Shanghai Cooperation Organization and the International Bamboo and Rattan Organization both headquartered in Beijing, had been granted observer status separately.

Contact the writer at xiaohong@chinadailyusa.com