With nearly 100 members, the China-initiated Asia Infrastructure Investment Bank (AIIB) has achieved remarkable results since its launch over three years ago, Luxembourg’s Finance Minister Pierre Gramegna told local news agency on Friday.
“We are glad we contributed from the beginning to the setting-up of AIIB, because this bank is a real success story,” Gramegna said in an interview during the fourth annual meeting of the AIIB, which is the first annual meeting to be held outside Asia, adding that hosting the meeting shows Luxembourg’s commitment to the development bank.
Recalling the initial motivation to join the AIIB’s founding, the 61-year-old minister who actually witnessed the birth and growth of the bank at its very early stage, gave three main reasons.
Firstly, Luxembourg believes in multilateralism. Gramegna underlined that multilateralism is the only way by which people can solve the issues like poverty and climate change around the world.
Against the backdrop of growing unilateralism and nationalism, Gramegna remains optimistic about the great future of multilateralism because “it has worked well in the past.”
From his perspective, the Paris Agreement on climate change signed in 2015 and the AIIB launched in 2016 are two multilateral events which will reverberate over the next couple of years and decades, much more than some sporadic unilateral move.
Thanks to international cooperation, around 1 billion people have been able to get out of poverty, as water supply, access to transport and other services have been overwhelmingly improved, Gramegna noted.
Secondly, Luxembourg shares with AIIB the willingness to take climate change seriously. Compared with traditional multilateral development banks, the AIIB with the motto “lean, clean and green” offers a very modern approach to addressing climate change, Gramegna noted.
“If we do not embark on sustainable development, if we do not try to save countries with a low standard of living through sustainable investment, if we don’t do these things well, climate change will make sure that the temperature would rise above two degrees and that our planet may basically not survive,” Gramegna warned.
In his view, since all AIIB members are signatories to the Paris Agreement, it’s necessary to work together to prevent global warming.
Thirdly, Luxembourg is the second largest home for investment funds after the United States, managing totally more than 5 trillion U.S. dollars, which means all this money can be tapped to help the AIIB achieve its objective, said Gramegna.
Gramegna is particularly proud of the prosperous green bond market in Luxembourg as an important international financial centre, noting that the European Investment Bank (EIB) based in Luxembourg issued the world’s first green bond in 2007 and Luxembourg Green Exchange, the largest platform exclusively dedicated to sustainable finance, was launched in 2016.
“So you see, we are pioneers in this field since the beginning and we continue to innovate,” he said, calling for increasing the share of sustainable investment funds in the financial market.
Gramegna appreciates the AIIB’s operational efficiency, which is evidenced by the fact that lots of investment plans that support sustainable development were executed during the last three years due to its very lean management.