Sustainable development took centre stage at the second annual meeting of the China-led Asian Infrastructure Investment Bank (AIIB), with its president stressing the need to uphold the Paris climate agreement and declare a firm "no" to coal projects.
"We would not consider any proposals if we are concerned about their environmental and reputational impact," Mr Jin Liqun said at the opening of the meeting in South Korea's Jeju island yesterday.
He said the bank places great emphasis on helping its 80 members, including three new ones - Argentina, Madagascar and Tonga - move towards a low-carbon future.
Some 2,000 delegates, including Singapore's Finance Minister Heng Swee Keat, his Chinese counterpart Xiao Jie and India's Mr Arun Jaitley, attended the three-day meeting.
The first annual meeting of the AIIB board of governors was held in China last year, and the third will be in India next year.
In a speech, South Korean President Moon Jae In urged the bank to focus on sustainable and people-oriented investment, promising that his country will also do its part.
South Korea is the fifth largest stakeholder in the multilateral bank, with a 4.06 per cent stake. China holds the largest share of 32.3 per cent, followed by India (9.08 per cent), Russia (7.09 per cent) and Germany (4.87 per cent).
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China, which has the largest share
Mr Moon also announced a plan to boost South Korea's production of renewable energy to 20 per cent of the total amount of energy it produces by 2030. He has already ordered old nuclear reactors and coal-fired power stations to be shut, which will cut carbon emissions.
The AIIB has approved US$2.5 billion (S$3.5 billion) worth of loans for more than 10 projects since its inception last year. These include the upgrading of slums in Indonesia, the building of a power station in Myanmar, and upgrading a hydro power plant in Pakistan.
The new bank joins other similar bodies like the Japan-led Asian Development Bank and the Washington-based World Bank.
In his speech, Mr Jin, AIIB's chief, emphasised the need to achieve the goals of economic development and environmental protection at the same time. He cited a power project in Bangladesh which would not only provide electricity for over 12 million people living in rural areas, but also reduce carbon dioxide by 16,400 tonnes every year.
"The project demonstrates AIIB's commitment to development, helping the world's underprivileged, and to the environment," he said.
South Korea's Finance Minister Kim Dong Yeon, who is chairing the meeting, said his country and the AIIB can form a "mutually beneficial investment partnership".
Seoul has agreed to invest an extra US$8 million in AIIB's special fund to provide capital for infrastructure projects in developing countries, despite frosty China- South Korea ties due to a row over a United States anti-missile shield installed in South Korea.