The trade minister is "100 per cent certain" Tony Abbott will sign Australia up to a Chinese-led Asia infrastructure bank if governance provisions are met.
Twenty other countries have signed a memorandum of understanding to set up the $57 billion Asian Infrastructure Investment Bank aimed at addressing a multibillion-dollar funding gap for dams, ports, roads and other capital works across the region.
Australia has put a set of governance provisions to China to ensure the bank will meet world standards.
Trade Minister Andrew Robb is confident Australia will join the bank if those provisions are agreed to.
"I am 100 per cent certain that the prime minister will sign up," he told Sky News on Sunday.
When told that was a "bold prediction", Mr Robb said it was one based on many conversations he'd had with Mr Abbott on the issue.
"He is concerned to make sure that we are party to a fully and properly governed body," Mr Robb said.
"I'm not going to speak for him, all I'm saying is that my judgment is that he will be there signing up if those governance provisions are met."
Mr Robb said China had "moved a long way already" on the governance provisions.
He added Australia would encourage both Japan and the United States to join the regional bank if an agreement could be reached.
"I see good things coming out of this, and an enhanced reputation for China as a proponent of stable, regional development," he said.
"There is an Asian economic miracle underway."
Opposition Leader Bill Shorten said Labor supported signing Australia up to the Asian Infrastructure Investment Bank.
And he said it appeared the Abbott government was about to backflip on the issue, after it had earlier rejected the bank on national security grounds.
"We had this crazy situation where the Abbott government treated the Asian Infrastructure Investment Bank as a security issue," he told reporters in Melbourne.
"When will Tony Abbott realise that to deal with China is not a military issue, it's an economic issue and an issue about the future?
"And indeed ... if the government has reversed its position from being the deputy sheriff of the United States to a more nuanced position, I guess we'll have to wait and see if that happens."
Mr Shorten said it was a "good thing" that China was seeking to build, and be part of, multilateral financial institutions.
"Labor supports the principle of engaging with China as it seeks to reach out to the rest of the world," he said.
