China will contribute $USD 40 billion to encourage connectivity across Asia by setting up a Silk Road infrastructure fund, announced President Xi Jinping this Saturday. This is China's latest project to advance the country's economic growth.
China's efforts to resurrect the old Silk Road trading route will principally expand trade initiatives between China and the Mediterranean. The multi-billion dollar fund will invest in infrastructure, resources and industrial as well as financial cooperation detailed Xi.
Chinese state media quoted Xi explaining that the objective of the fund is to "break the connectivity bottleneck" in Asia as he met with leaders from Bangladesh, Laos, Mongolia, Myanmar, Pakistan and Tajikstan.
The Silk Road fund will focus on China's Silk Road Economic Belt as well as 21st Century Maritime Silk Road initiative that look to build roads, railways, ports and airports across Central and South Asia. "Such a framework accommodates the needs of various countries and covers both land and sea-related projects," Xi explained.
Xi confirms that the Silk Road fund will also be open to investors from Asia and beyond ahead of a the upcoming summit of the Asia Pacific Economic Cooperation (APEC) to be held in the Chinese capital. The Chinese government has not announced when or where the fund's operation will begin.
In October, China unveiled a $USD 50 billion Asian Infrastructure Investment Bank which has been considered a challenge to the World Bank and Asian Development Bank, both international money lending institutions that depend on the United States and its allies.