Australia will become a founding member of the Asian Infrastructure Investment Bank (AIIB), Treasurer Joe Hockey has announced.
The decision comes after extensive discussions between the Government, China and other key partners around the world.
Mr Hockey has committed to contributing $930 million into the bank over the next five years, making it the sixth largest shareholder.
He said there would be a great benefit for the nation to be involved from the beginning.
“It provides massive new opportunities for Australia to join with 56 other countries as founding members in building the essential infrastructure for Asia,” he said.
The Beijing-based investment fund is designed to help finance infrastructure projects across Asia,using a mix of public and private funding.
It is planned to operate broadly in the same manner as existing multilateral development banks such as the World Bank and the Asian Development Bank.
It will start with an authorised capital base of $US1 billion.
A total of 57 countries have been approved to be signed on as founding members of the bank since it was first floated by China’s president Xi Jinping in October 2013.