AIIB President Jin Says Pandemic Impacts Bank’s Lending
(Bloomberg) -- The coronavirus pandemic has led to a slowdown in developing physical infrastructure as countries’ economic health deteriorates, posing a challenge for the Asian Infrastructure Investment Bank, its president said.
“What worries me, what worries the bank is the deterioration of the economic situation of some of our members,” Jin Liqun said in an interview Saturday with Bloomberg Television on the sidelines of the Bund Summit in Shanghai. Economic setbacks for member countries could mean “increased impairment charges to our net income.”
The China-backed development bank has set aside $13 billion to aid members’ recovery from Covid-19, a figure Jin said is unlikely to increase.
“I want to shift quickly back to mainstream business,” he said, adding that the bank also intends to invest in the health sector going forward.
Jin, China’s former vice finance minister, said the biggest risk for the world’s second-largest economy is controlling local government debt. Debt sustainability in less-developed provinces requires a lot of attention, but “if China takes care of this, no problem,” he said.
Despite tense relations during President Donald Trump’s term, Jin expressed optimism about the potential for a reset in U.S.-China ties after the American election next month.
“There must be candid, frank and constructive dialogs between the two sides,” he said.
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