Japanese government officials reacted calmly to South Korea’s decision to join the planned Chinese-led Asian Infrastructure Investment Bank.
The South Korean decision on Thursday “is not surprising,” a senior Finance Ministry official said.
A high-ranking government official noted that Japan’s stance toward the AIIB “has not changed,” suggesting Tokyo will continue to carefully consider whether to take part in the planned new international development bank.
Another official also said that South Korea’s move was not beyond expectations, adding that the country may be trying to gain an advantage over Japan by joining the AIIB ahead of its rival’s possible participation.
South Korea’s Strategy and Finance Ministry announced Thursday that the country would participate in the AIIB as one of its founding members. China plans to launch the bank by the end of this year. More than 30 countries have announced their intention to join the bank.
South Korea has moved to strengthen its economic relations with China. The two countries have agreed on a bilateral free trade agreement.
Japan and the United States, which is also cautious about the AIIB, have asked Australia and South Korea, both close U.S. allies, not to become AIIB members. Australia is expected to make a decision shortly, sources said.
It is understood that countries hoping to become founding members need to file their applications by the end of this month.
The Japanese government has said it cannot participate in the bank unless transparency in its management is secured. It will delay its decision until late June, when details of the bank will likely be set.
However, analysts warn now that South Korea and major European countries, including Britain, France, Germany and Italy, have decided to participate, Japanese firm may start to voice concerns that they may be put at a disadvantage in the race for infrastructure projects in developing countries if Japan stays out of the AIIB.