Posts Tagged ‘Bank’

China’s new bank is a great attractor

April 13, 2015

AIIB-Asian-Infrastructure-Investment-Bank-Countries

The world is rushing to join the new Asian Infrastructure Investment Bank, which is China’s alternative to the U.S.-influenced World Bank.

The Shanghai-based bank would raise $50 billion to invest in Asian infrastructure projects, such as dams, airports and electric power plants.

Only founding members are entitled to a vote.  Reuters reported that voting will be weighted so that Asian members have 75 percent.  China will announce the names of the founding members on Wednesday (April 15).   The Economist explained:

The AIIB is but one of a number of new institutions launched by China, apparently in frustration at the failure of the existing international order to accommodate its astonishing rise.

Efforts to reform the International Monetary Fund are stalled in the American Congress.  America retains its traditional grip on the management of the World Bank.  The Manila-based Asian Development Bank (ADB) is always directed by a Japanese official.  [snip]

China, flush with the world’s biggest foreign-exchange reserves and anxious to convert them into “soft power”, is building an alternative architecture. 

It has proposed not just the AIIB, but a New Development Bank with its “BRICS” partners—Brazil, Russia, India and South Africa—and a Silk Road development fund to boost “connectivity” with its Central Asian neighbors.

(more…)