Australia has "considerable interest" in joining a China-led development bank, Foreign Minister Julie Bishop says.
The $57 billion Asian Infrastructure Investment Bank is being promoted by China as a way of financing regional development.
Britain last week joined discussions with other founding members to set out the bank's governance and accountability policies.
Australia, the US, Japan and Korea have declined to support the bank, citing concerns about its governance.
Treasurer Joe Hockey last week said the government was reconsidering its position in light of UK and New Zealand support for the bank.
Ms Bishop told reporters in Canberra on Monday it had always been Australia's intention to negotiate with China, but some concerns remained and a set of "milestones" needed to be met.
"We want to ensure that anything that we invest in is meeting the very high standards of the kind of multilateral institutions that Australia has supported in the past," she said.
"Obviously the more countries that are involved and are having their concerns addressed then the easier it will be for Australia to have our concerns addressed."
Ms Bishop said she had had some positive discussions with US Secretary of State John Kerry about the bank.
Australian Industry Group chief Innes Willox says the government is right to rethink its opposition to joining the Asian Infrastructure Investment Bank.
As the global economy's centre of gravity shifts from the Atlantic to China it was essential Australia was part of the change, he said.
"By reversing its opposition ... the government would be positioning Australia to be an active participant in this changing landscape, not simply a bystander," Mr Willox said in a statement.
Labor said Ms Bishop had "totally mishandled" the issue and was now playing catch-up.
The government should have announced its support for the bank months ago, according to the opposition's Tanya Plibersek and Chris Bowen.
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