Uruguay's government presented a bill in Congress to join the Asian Infrastructure Investment Bank, or AIIB, in an effort to widen its potential financing sources as it is faced with limited credit from the World Bank, El País reported Sept. 25.
The country would need to contribute $5 million in capital to join the bank, the Montevideo-based daily newspaper reported, citing a draft law from the government.
With Uruguay being classified as a high-income country, it has seen some of its international long-term funding options dwindle. The Latin American country will therefore seek to expand its financing sources to other multilateral credit organizations, to secure credit alternatives "particularly during periods of volatility in international capital markets," the draft law noted.
According to the bill, the country will work to establish a closer rapport with the Asian investor base and entities, in order to generate strategic financial, commercial and diplomatic relationships.
The draft also cited the important role of Japan and China on the global stage as well as lower interest rates as motives behind the decision to join the AIIB.
