Cabinet endorses AIF negotiation framework

 The framework is yet to win parliamentary approval.

 Under the initiative, AIF will finance infrastructure development in the region with funds raised in the region. Bonds will be issued, to make the full use of regional savings, and they can be held as foreign reserves.

 All Asean members except Burma will join the AIF, which also wins support by the Asian Development Bank. The initial funding is US$485.2 million, including $15 million seed money from Thailand. ADB, which will manage the fund, will lend 70 per cent to all approved infrastructure projects while the fund will loan the remaining 30 per cent.

 The fund's size will be raised through hybrid bonds and bonds as well as additional injection from members.