06/04/2015
China / Economics
Despite the fanfare surrounding the establishment of the AIIB, a clear mission statement has yet to be produced. In the words of President Xi, the AIIB would boost growth and improve infrastructure across the region to help fulfil an "Asia-Pacific dream".
Created and largely funded by China, the Asian Infrastructure Investment Bank (AIIB) aims to be a multilateral lender to the region. The AIIB is central to China’s “One Belt, One Road” strategy. It will fund highways, ports, and other infrastructure throughout a "Silk Road Economic Belt" across the Eurasian land mass. Among other things, it would allow China to export its technologies and production more broadly to the region. The AIIB would also hasten RMB internationalisation.
Despite the fanfare surrounding the establishment of the AIIB, a clear mission statement has yet to be produced. In the words of President Xi, the AIIB would boost growth and improve infrastructure across the region to help fulfil an “Asia-Pacific dream”. Many find this laudable but vague. Only when the aims are clarified can participating countries decide how much to contribute and what role they might best play.
Here are a few key points from the report:
- The AIIB is key to China’s “One Belt, One Road” strategy
- China and founding members must cement the bank’s objectives, create a credible governance structure and adopt prudent and transparent lending practices
- The most difficult challenge may be balancing China’s interests with other founding members
To read the full report, download the PDF.
