Asian Investment Bank Bill Progresses

A law allowing New Zealand to join the Asian Infrastructure Investment Bank has received the support of all parties except New Zealand First with the Government wanting the bill reported back in just five weeks.

Following Question Time the first reading of the International Finance Agreements Amendment Bill was completed by 109 to 12.

Finance Minister Bill English said the bill would allow the New Zealand Government to join the Asian Infrastructure Investment Bank and implements New Zealand's obligations under the Articles of Agreement of the Infrastructure Bank.

Last year the Chinese Government floated the idea of such a bank. There was initially some scepticism about whether the bank was needed and how it work. New Zealand was one of the first developed countries to put up its hand for talks to see if a truly multilateral development bank and the Chinese leadership had been very keen to set up a modern multilateral investment bank. It has been an unexpected but welcome result which had now been supported by many countries.

Mr English said New Zealand’s future lay in the Asian region and it was important to broaden our interests and relationships across the region where there was a significant need for quality infrastructure to support growth and development.

Labour’s finance spokesman Grant Robertson said it looked like the bank would be a significant player and the ministers had rightly talked about the speed at which it was being set up. Mr Robertson said this pace was the one note of caution he had about this and the select committee should look carefully to see the correct governance was being put in place.

The bank was a real attempt to build up a coherent infrastructure investment strategy across the region.

Mr Robertson said it should be noted the Bank would be funded from the “Future Investment Fund” ie through the proceeds of sales of assets. The Fund appeared to have been over subscribed and was a bit of an accountancy trick.

Only NZ First MPs opposed the legislation though the Greens had some reservations. NZ First said it was opposed to investing the money from asset sales in offshore investments for the benefit of other countries. New Zealand would also be a small member of the bank and will not have a say about how money was allocated

The bill was sent to the Foreign affairs, Defence and Trade Committee for consideration with a report back by October 22 2015. The motion approving the truncated report back was passed by 63 to 58 with National, Maori Party, ACT and United Future supporting.

MPs then began the first reading of the Māori Purposes Bill.

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