(Corrects in first paragraph to Japan's finance minister, not
By Tetsushi Kajimoto and Ian Chua
TOKYO/SYDNEY, March 20 Australia said on Friday
there was a lot of merit in the China-led Asian Infrastructure
Investment Bank (AIIB) while Japan's finance minister signalled
cautious approval of the institution that the United States has
However, other top officials in Tokyo were more sceptical,
reflecting a split in the government of Prime Minister Shinzo
Abe over whether joining an institution launched by Japan's main
rival would help or hinder its interests.
The Sydney Morning Herald newspaper reported that Canberra
could formally decide to sign up to the AIIB when the full
cabinet meets on Monday.
Japan, Australia and the South Korea, all major U.S. allies,
are the notable regional absentees from the AIIB. The United
States, worried about China's growing diplomatic clout, has
questioned whether the AIIB will have sufficient standards of
governance and environmental and social safeguards.
But the opposition to the AIIB began crumbling after
Britain said earlier this month that it would join the
institution, saying it was in its national interest. France,
Germany and Italy swiftly followed suit.
Australia now appears close to joining, although no formal
decision has been made, and Beijing said Japan and South Korea
were also considering the possibility.
Asked about the three countries joining the bank, China's
Foreign Ministry said it was "open" to it.
"They have all already expressed that they are contemplating
the issue at hand," ministry spokesman Hong Lei told a daily
briefing. "We are open to them making the relevant decision."
Japanese Finance Minister Taro Aso said Tokyo could consider
joining the China-led bank if it could guarantee a credible
mechanism for providing loans.
"We have been asking to ensure debt sustainability taking
into account its impact on environment and society," he told
reporters after a cabinet meeting.
"We could (consider to participate) if these issues are
guaranteed. There could be a chance that we would go inside and
discuss. But so far we have not heard any responses."
Other officials were more leery, reflecting Tokyo's concern
over China-led lending practices, its relations with major ally
Washington and the AIIB's potential rivalry with the Asian
Development Bank (ADB), the Manila-based multilateral
institution dominated by Japan and the United States.
"We have a cautious position about participation," said top
government spokesman Yoshihide Suga.
According to one senior official in the ruling coalition,
the result is that Japan's participation "is not going to happen
under the Abe administration".
Australia's Hockey said no final decision had been made on
Australia's involvement but the matter had been under careful
"More than 30 countries have already signed up. This is
going to operate in our region, in our neighbourhood," he told a
radio station in Brisbane.
"There is a lot of merit in it, but we want to make sure
there are proper governance procedures. That there's
transparency, that no one country is able to control the
The Sydney Morning Herald said Canberra could invest as much
as A$3 billion ($2.3 billion) in the bank and that the National
Security Committee has cleared the way for the investment.
South Korean government officials denied a newspaper report
that Seoul had decided to join in exchange for a five percent
stake in the AIIB and the position of deputy chief.
The finance ministry said in a statement South Korea will
make a decision on whether to join the bank "through close
consultation with major countries and after considering various
factors such as economic advantages and disadvantages".
Hockey said joining the AIIB would not affect Australia's
close relationship with the United States and also referred to
the gains that Australian companies could reap.
"The United States understands that this is a bank that's
going to be operating in our region. It's going to be using
contractors in our region. We want Australian contractors
involved, we want work for Australians out of this bank," he
"And because it's operating in our region, in our
neighbourhood, it is important that Australia fully understand
and look at participating in this Bank."
($1 = 1.3067 Australian dollars)
(Additional reporting by Leika Kihara, Yuko Yoshikawa and Kaori
Kaneko in TOKYO and Megha Rajagopalan in BEIJING, Editing by