UK support for AIIB prompts US concern

Published on Author taa16

On March 12th, Britain announced to join China’s new Asian Infrastructure Investment Bank (AIIB) as a founding shareholder, making it the first big Western economy to apply for membership of AIIB. This movement has raised concerns to the US, its closest and most important ally.

AIIB is one of a number of new institutions launched by China to fund Asian energy, transport and infrastructure projects. It was created in October 2014 by 21 countries. America has reacted negatively to the AIIB, worrying about the institution abiding by international standards—of transparency, creditworthiness, environmental sustainability, and so on. Other staunch American allies—Australia, Japan and South Korea—have so far stayed out, but UK decided to side with the superpower’s emerging rival. In fact, a spokesperson for Prime Minister David Cameron said, “There will be times when we take a different approach.”

Since David Cameron, accompanied by the biggest British trade mission ever, visited China in December 2013, the British government seems to have been preoccupied by the commercial potential of the Chinese market to the exclusion of all else. Even its Joint Declaration with China assuring Hong Kong of 50 years of internal autonomy after its reversion to Chinese sovereignty in 1997 has seemed less important.


3 Responses to UK support for AIIB prompts US concern

  1. South Korea is also still considering the participation as the deadline set by China is the end of the month. South Korea has already suspended TPP which is driven by U.S. due to the relationship with China. Many Korean economists and analysts argue that it is time to pursue national interest and take the practical choice considering the massive new demand market in Asia after joining AIIB.

  2. After UK, Australia is considering joining AIIB as well.
    “The Australian newspaper quoted Tony Abbot, Australia’s Prime Minister as saying: “I note that the U.K. has indicated an intention to sign up for the negotiations, the New Zealanders before Christmas signed up for the negotiations, the Singaporeans likewise, the Indians likewise.” He added that Canberra was “looking very carefully at this and we’ll make a decision in the next week or so”. On Monday, Australian Foreign Minister, Julie Bishop said negotiations with China were “very positive.” “

  3. Japan will join AIIB … though their announcement had several provisos. I’ve not looked at the details to see how big a hedge those are.

    Attend Amb. Chun’s talk Wednesday, or attend one of the other events. This is clearly a question to pose to him!

    Note my own belief is that the more the merrier. The Asian Development Bank and the World Bank (and also the IMF) are hamstrung in their operations because the US House won’t consider legislation that would increase the US capital contribution (which is akin to a loan rather than an expenditure). However, we also refuse to lower our voting share, so no one else wants to put in more equity, above all China, if the US can then decide how the ADB and WB [formally, the IBRD] and IMF will operate. So the AIIB is in part a result of US intransigence in other international development organizations.