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China, SKorea put missile rift on hold to join AIIB meeting

Associated Press logo Associated Press 16/06/2017 By YOUKYUNG LEE, AP Business Writer
South Korean President Moon Jae-in speaks during a meeting of the Asian Infrastructure Investment Bank on Jeju Island, South Korea, Friday, June 16, 2017. Putting aside a rift over a U.S. anti-missile system, top officials from China and South Korea were attending a meeting of a China-backed Asian lending bank that opened Friday on the South Korean island of Jeju. (Bee Jae-man/Yonhap via AP) © The Associated Press South Korean President Moon Jae-in speaks during a meeting of the Asian Infrastructure Investment Bank on Jeju Island, South Korea, Friday, June 16, 2017. Putting aside a rift over a U.S. anti-missile system, top officials from China and South Korea were attending a meeting of a China-backed Asian lending bank that opened Friday on the South Korean island of Jeju. (Bee Jae-man/Yonhap via AP)

SEOUL, South Korea — China and South Korea put aside hard feelings over Beijing's objections to a U.S. anti-missile system to join an annual meeting Friday on the South Korean island of Jeju of a China-backed Asian lending bank.

Chinese finance minister Xiao Jie and his Indian counterpart Arun Jaitley were among those attending the Asian Infrastructure Investment Bank's second annual meeting, which will wrap up over the weekend.

South Korean officials said finance ministers of the two countries met for talks on the meeting's sidelines and reaffirmed their "solid economic ties," agreed to continue collaboration as major founding members of the AIIB.

It was unclear if the meeting will pave the way for a broader thaw in chilled relations. South Korean officials declined to say whether the ministers discussed the thorny missile issue, citing a confidentiality agreement with Chinese officials.

South Korea was picked to host the gathering before Beijing began protesting Seoul's agreement to let its ally the United States deploy on its territory key components of the so-called Terminal High-Altitude Area Defense system. South Korea and the U.S. say the system is needed to deter a possible North Korean attack but Beijing sees it as a threat to its own security because its radar can peer deep into northeastern China.

Since China began protesting the THAAD deployment in late February, visits by Chinese tourists have dropped sharply and some companies operating in China, South Korea's largest trading partner, were asked to suspend their operations there.

The brouhaha between Seoul and Beijing stopped hogging local headlines after South Korea's new president took office in May and ordered an environmental review before completing the missile defense system's deployment.

Sustainable energy is a key theme at this year's meeting. The issue has taken front stage following U.S. President Donald Trump's recent decision to withdraw from the Paris climate accord, which the president characterized as being unfair to the U.S.,

In a statement issued Friday, the AIIB said it supports its members "to do their part as expressed in the Paris Agreement" and pledged to prioritize investment in renewable energy projects and projects that enhance the energy efficiency of existing infrastructure.

"We are ready to do our part in support of the Paris Agreement," Jin Liqun, the AIIB President, said in the statement.

The China-led AIIB added three more countries to its membership on Friday, bringing the total to 80 member countries. They include some American allies such as Britain and Australia. The U.S. has shunned the initiative, while Japan has also stayed away but expressed openness to joint projects with the Manila, Philippines-based Asia Development Bank.

Twenty five member countries sent representatives to Jeju, the lending bank's first meeting outside China, South Korea's finance ministry said.

Some environmental activists have expressed concerns that the AIIB may support coal.

While the Asian lending bank pledged to support "low-carbon energy," in a report earlier this year, it said the bank also might support oil- or coal-fired power plants if they replace less-efficient facilities or no other options are available. The Asian Development Bank and other experts say coal is likely to be the cheapest option for economies such as Bangladesh.

South Korean President Moon Jae-in used the meeting's opening ceremony to promote his new administration's clean energy initiatives. In his debut speech at an international conference, Moon said South Korea will sharply increase its reliance on renewable energy to 20 percent by 2030 from about 5 percent in 2015. Moon also reiterated a commitment to cut use of coal and nuclear energy by Asia's fourth largest economy.

"So far infrastructure investment has contributed to economic growth in each country, but it has also damaged natural environments in the process. South Korea also had painful experiences like that and we are learning many lessons," Moon said.

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AP Business Writer Joe McDonald in Beijing contributed to this story.

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