China: New AIIB bank is alternative to Western financing

Over the weekend, China unveiled its newest foreign policy initiative: the Asian Infrastructure Investment Bank (AIIB) a multilateral development bank headed by Beijing to provide financing for Asian projects. The AIIB is a clear rival to Western-headed development banks such as the IMF, the World Bank, and the Asian Development Bank, which are all popularly regarded as dominated by Western developed countries like the United States and Eurozone. The opening of the bank’s doors for applications for the position of Prospective Founding Member has seen a major breaking of ranks for staunch Western allies like Australia, Japan, Great Britain, and even Canada.

The bank will ostensibly allow for the development of projects under the “New Silk Road Economic Belt” policy, which will channel foreign and domestic capital towards developing neighbors and regional partners of China, including several oil and gas exporters in Central Asia. The New Silk Road Economic Belt policy, according to Xinhua, will work “perfectly in tandem” with the nascent AIIB.

Russia also chomped at the bit to be one of the prospective founding members, as part of a larger strategy to pivot to Asia in light of European sanctions and its ongoing conflict in Ukraine. The United States, however, has spent the past few weeks trying to convince allies to decline joining the bank, citing the need for assurances that the development it finances will meet global standards of environmental and labor conditions.

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