ArmInfo. On September 11, the Government of Armenia approved the instrument for the subscription of the Republic of Armenia to the Asian Infrastructure Investment Bank (AIIB).
The Asian Infrastructure Investment Bank was established by China in 2015. It is a multilateral development bank whose goal is to promote sustainable economic development in the Asia-Pacific region, creating prosperity through improved infrastructure, in close cooperation with international multilateral and bilateral development institutions. The Bank has 106 confirmed member countries, 57 founding countries, including Iran (2,541 shares), Georgia (539 shares), Turkey (26,099 shares) and Azerbaijan (2,541 shares). The leaders of the organization are China, India and Russia, which actually have the right to veto the most important decisions of the PRC.
The main vision of AIIB is to create a "green" infrastructure based on new technologies that meets modern challenges and ensures sustainable development. The main goal of the Bank is to promote prosperity and economic development in Asia. To achieve this goal, the Bank has adopted the "Four Innovations" strategy, covering financial, economic, social, environmental aspects and digitalization of services. It promotes sustainable development both at the local and global levels.
The total authorized capital of the Bank is $ 100 billion and is divided into one million shares with a par value of $ 100 thousand each.
AIIB provides financing or financial assistance to the following organizations: - the government of a member state or any of its agencies; - any private organization operating in the territory of a member state; - international or regional organizations or bodies dealing with economic development.
AIIB carries out its activities in the following ways: - by providing, co-financing or participating in direct loans, - by investing financial resources in the share capital of an institution or enterprise, - by guaranteeing the provision of loans intended for economic development, both as a primary and as a secondary obligated entity, both in full and in part, - by attracting funds from Special Funds in accordance with the agreements determining their use, - by providing technical assistance.
The process of subscription of Armenia to AIIB shares provides for subscription to shares of the bank's share capital through paid shares and demand shares. The value of one share is $ 100 thousand. In 2017, Armenia submitted an application to the Bank, which provided for Armenia's subscription to the Bank's shares by subscribing to 374 shares.
In 2019, the Ministry of Finance of the Republic of Armenia proposed that Armenia subscribe to the Bank's shares with 5 shares, which was fundamentally rejected, since all candidates, with the exception of the smallest number, subscribe to the Bank's shares with 5 shares. In accordance with Article 58 of the AIIB Agreement, the amount initially subscribed to must be paid by each signatory to the Agreement upon entry into it in five instalments, each amounting to 20% of that amount. The first instalment must be paid by each member within 30 days of the entry into force of the Agreement or on the day of deposit of its instrument of ratification, acceptance or approval. The second instalment must be paid one year after the entry into force of the AIIB Agreement. The remaining 3 instalments must be paid successively one year after the date of payment of the previous instalment.
Currently, the Republic of Armenia has been offered membership in the AIIB with a maximum of 374 shares, of which 299 are demand shares, and the amount of the remaining 75 shares is $7.5 million, payable in five equal installments of $1.5 million.
"Joining the Bank is considered important in terms of giving new impetus to the Armenian-Chinese political dialogue. At the same time, attracting investments financed by China can create opportunities for the modernization of Armenia's transport infrastructure. Joining the AIIB provides the Republic of Armenia with the opportunity to participate in large-scale regional investment programs, cooperating with other multilateral and bilateral development institutions. Membership is also advisable in terms of diversifying sources of credit resources," the document says.
Armenia became a member of the Asian Infrastructure Investment Bank (AIIB) in 2024. At the plenary session on June 12, 2024, the National Assembly of the Republic of Armenia approved the draft agreement with the Bank submitted by the Government of the Republic of Armenia.
