MANILA (REUTERS) - The Philippines is set to join the China-backed Asian Infrastructure Investment Bank (AIIB), describing it as a "promising institution" that could help accelerate the country's economic growth.
The AIIB, which has become one of China's biggest foreign policy successes, has been formally established and is expected to be operational early next year.
Despite the opposition of Washington, other major United States allies such as Australia, Britain, Germany, Italy and South Korea have also joined the bank, which is seen as a potential rival to the World Bank and Asian Development Bank.
For the Philippines, the AIIB "will augment and complement existing multilateral institutions in accelerating economic growth", Finance Secretary Cesar Purisima said in a statement.
"AIIB is a promising institution addressing investment needs, and will help close financing gaps in many countries," Mr Purisima said, adding the Philippines is confident the bank is committed to "transparency, independence, openness and accountability".
South-east Asia's fifth-largest economy requires US$127 billion (S$180 billion) from 2010 to 2020 to finance its infrastructure needs, the Asian Development Bank has projected.
Founder members will initially pay 20 per cent of AIIB'S US$100 billion authorised capital. The Philippine's indicative paid-in capital is US$196 million, the Department of Finance said.
Manila is embroiled in territorial disputes with Beijing over some islands in the South China Sea.
The Philippine has challenged Beijing before the arbitration court in the Hague, a case Beijing has not recognised.