A total of 17 countries have stamped their seal of approval on Friday for the official establishment of the Asian Infrastructure Investment Bank (AIIB), a China-led initiative that seeks to further provide infrastructure funding in the Asian region.

The approval of the 17 nations, which included Germany, South Korea, the United Kingdom, and Australia, was enough to officially establish the AIIB, which will issue its first loan in the middle of next year, according to China's Ministry of Finance.

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The 17 economies represent 50.1 percent of the AIIB's total subscribed capital and the number was more than what the bank's charter requires. According to the AIIB charter, the bank is legally valid as long as more than 10 nations approve the charter.

Other major member economies, however, have not yet approved the charter, which is also known as the articles of agreement. These economies include India, Russia, and Brazil.

The AIIB as 57 prospective found members, who have until the end of 2016 to approve the AIIB charter and become official members of the China-proposed infrastructure investment bank.

Chinese Finance Minister Lou Jiwei describes the launch of the AIIB as a milestone for the reform of the global governance system.

He also downplayed insinuations that the AIIB was created to compete with existing international financial institutions such as the World Bank and the Asia Development Bank (ADB).

Lou said the AIIB will work alongside in unison with existing institutions, such as the World Bank and the ADB, to ensure sustainable economic growth in the region.

The United States and Japan, which is a major stakeholder in the ADB, have not joined the AIIB even as their allies have scampered to participate in the initiative.

In January, AIIB members will convene to elect the first president and 12 directors of the bank. Being a China-proposed initiative, China will hold 26.1 percent of the voting rights. It also has the right to veto decisions.

TagsChina AIIB, Asia Infrastructure Investment Bank, AIIB, investment bank, Infrastructure Bank