The View | Big infrastructure, Xi Jinping and the real role of the AIIB
The Asian Infrastructure Investment Bank will likely finance the next wave of infrastructure construction across the Asian region
I’ve attended a number of speeches where eyes rolled while a Chinese government official read from a narrow script. So it was interesting to attend a speech last week where a Scot received the same treatment - simply for working for the Chinese.
Danny Alexander, a former Chief Secretary to the Treasury who is now a vice president at the Beijing-based Asian Infrastructure Investment Bank (AIIB), spoke last week in Hong Kong, and even before he stepped to the podium, one could guess he was going to face a tough crowd.
During the introductions, references were made to the “Ginger Rodent” beer brewed in his former electoral district - and named after him, as tribute to the colour of his hair as well as an insult once hurled at him by a Labour opponent in parliament.
Beijing is trying to send a message that the AIIB is not a vehicle for underwriting a global conquest of Chinese enterprises
Alexander laughed off the reference and went on to glossily explain why he, while in the cabinet, had supported the UK’s decision to become a founding member of the AIIB, even as other major countries, such as the US and Japan – who respectively dominate the World Bank and the Asian Development Bank - have been suspicious from the start of this new multilateral on the block.
Alexander received his offer from the AIIB soon after the Liberal Democrat MP was voted out office in the general elections in May 2015. Some saw this as a quid pro quo. Less cynically, by carving out roles for foreigners, Beijing is trying to send a message that the AIIB is not a vehicle for underwriting a global conquest of Chinese enterprises, or bringing more countries into Beijing’s political sphere while simultaneously bringing more natural resources into China.
Rather, as Alexander laid out in his speech, the AIIB was launched because the infrastructure needs of the region are so phenomenal. Some two-thirds of the world’s population is in greater Asia, but the region accounts for only one-third global economic output. This shows there is still lots to build out here.
Later, during the question and answer period, an audience member asked if the AIIB was a vehicle to finance President Xi Jinping’s One Belt, One Road initiative that aims to modernise connectivity and infrastructure along the ancient Silk Road route.
