Kelly O'Dwyer (Higgins, Liberal Party, Parliamentary Secretary to the Treasurer) Share this | Hansard source

I thank those members who have contributed to this debate. This bill, the Asian Infrastructure Investment Bank Bill 2015, is necessary for Australia to become a founding member of the Asian Infrastructure Investment Bank.

In our region, Asia faces a major infrastructure financing gap, estimated to be worth US$8 trillion this decade. By becoming a founding member of the Asian Infrastructure Investment Bank we are taking a significant step to address this financial gap and to position Australia to take advantage of the opportunities to come from infrastructure development in Asia.

The Asian Infrastructure Investment Bank will provide trade and economic opportunities for Australian businesses and help our commodity exports, using its authorised capital base of US$100 billion to help address the infrastructure needs of the Asia-Pacific. With the bank to become operational from late 2015, Australian companies will be able to bid for AIIB-financed projects, with the AIIB's open procurement model. It will have an early focus on transport, energy and water infrastructure, and will later invest in ports, logistics, environmental protection, information and communications technology, and agriculture.

Australia's prosperity and economic growth are tied closely to Asia, with improved infrastructure throughout Asia also providing greater opportunities for Australian trade and businesses. With a growing pipeline of infrastructure projects, the Asian Infrastructure Investment Bank will likely see an increased demand for Australian commodities and services, such as engineering, construction management, finance and consultancy.

Improved infrastructure, such as new ports and railways in AIIB member countries like India and Indonesia, also means that Australia's exports can reach new or expanding markets. Greater levels of infrastructure means Australian businesses can capitalise on new and expanded commercial opportunities by meeting increased demand arising from stronger economic growth driven by new infrastructure. For example, building port facilities in India could provide extra capacity for Australian commodity exporters; constructing a railway in Indonesia will help to transport Australian agricultural products to market; and Australian consultants and fund managers could be designing and co-financing a toll road project in Laos.

More broadly, the Asian Infrastructure Investment Bank presents an opportunity to further strengthen Australia's engagement with the region, including with our biggest trading partner, China, and deepen our relationship with other member countries including New Zealand, Singapore, the United Kingdom and Vietnam.

Australia will contribute US$738.3 million, around A$932 million, paid-in capital to the bank over five years. Importantly, this will make Australia the sixth largest shareholder of the bank, putting us in a prime position to influence the bank's decisions and strategic direction. We will work with China and other bank members to establish a bank that is effective, accountable and transparent and that complements the work of the World Bank and the Asian Development Bank.

The Asian Infrastructure Investment Bank will boost economic growth, create jobs and promote trade in our region by financing much-needed infrastructure, and it is important that Australia involve itself so that we too can take advantage of the opportunities that it presents.

I commend the bill to the House.

Question agreed to.

Bill read a second time.

Message from the Administrator recommending appropriation announced.

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