Move will boost European ties, investment: experts
China officially became a shareholder of the European Bank for Reconstruction and Development (EBRD) on Tuesday, which is expected to boost the "One Belt, One Road" initiative and also allow China to share its development experience with the EBRD.
Established in 1991 and headquartered in London, the EBRD provides financial support for economic transition and development in areas such as Central and East Europe, as well as Central Asia, according to a statement published Tuesday on the website of the People's Bank of China (PBC), China's central bank.
"China is the world's largest economy in transition. Joining the EBRD can facilitate China's communication with the EBRD on economic transformation as well as development experience," the statement said.
The EBRD now has 67 shareholders, comprising 65 countries and regions and two international organizations.
Yu Fenghui, a financial commentator, told the Global Times on Tuesday that Chinese entrepreneurs are currently looking for good investment projects in overseas markets, and China becoming an EBRD shareholder can facilitate such investment.
Most of the EBRD's shareholders are European countries, so China's participation in the bank can help build economic contacts with European countries, as well as allowing China to exert greater influence on Europe's economic development, Dong Dengxin, director of the Finance and Securities Institute at Wuhan University of Science and Technology, told the Global Times on Tuesday.
"As the world's second-biggest economy, it's China's responsibility to get more actively involved in Europe's economic development," Dong also noted.
According to the PBC, China's membership will also "provide new cooperation opportunities" for China and countries along the "Belt and Road" route.
Some of the EBRD's current shareholders, like Kazakhstan, are countries that lie along the land route of China's "Belt and Road" initiative, a concept proposed by President Xi Jinping in 2013 in a bid to encourage Chinese enterprises to make more overseas investment.
Dong noted that China could seek win-win cooperation with many of the countries along the route, especially in infrastructure projects.
Dong also told the Global Times that China could learn from the EBRD on how to run regional financial institutions, as China has established some institutions of a similar nature, such as the Silk Road Fund.
For the EBRD, cooperating with China will also allow a significant expansion of its business.
According to a report by the Financial Times in October, the EBRD disbursed 800 million euros ($882 million) in 2014 on projects related to Central Asian countries. Cooperation with Chinese lenders would allow the EBRD to expand its operations in this region.
EBRD President Suma Chakrabarti also said in a statement on Tuesday that China's membership will open up "significant further opportunities" for sustainable investment by Chinese groups in the regions where the EBRD operates.
The EBRD has also expressed its readiness to work with the Asian Infrastructure Investment Bank (AIIB), the statement said.
Yu said that the EBRD and the AIIB could collaborate in various ways, such as conducting joint assessments of investment projects' feasibility, or making joint investments themselves.
According to the PBC's statement, the EBRD wouldn't conduct business directly in China.
