The United States Should Welcome the AIIB
By WILLIAM HEIDLAGE
WASHINGTON — Over the past decade, there has been constant tension in the West over how to view China’s rising responsibility and role in international development. Some have welcomed China’s presence—Christine Lagarde applauded the Chinese government for its leading role in Africa last May—and some have urged China to play an even larger role.
But often, the United States has approached China’s growing role in development as a challenge to its hegemony. The current debate over the Asian Infrastructure Investment Bank (AIIB), and the BRICS bank established over the summer, has not just focused on how they disrupt the role of the IMF and World Bank. Rather, the United States has pressured allies not to join the bank out of fear that it will become a tool of Chinese heavy-handed regional soft power.
However, China’s growing role—at least in this realm—needs to be both cautiously welcomed and understood. Xi Jinping is looking to invest along the “New Silk Road,” which wraps in and around some of the most underdeveloped and unstable countries in Asia. The $50 billion AIIB fund, supported by China, India, and Pakistan, thus promises engagement in a region often ignored. Rather than seeing such engagement as a threat, the United States needs to understand that stabilizing and developing Central Asia is an interest the two countries share.
Moreover, the Western institutions that the AIIB ‘competes’ with have not accommodated China’s growing economy with an equitable voting share. The World Bank and IMF are nearly 70 years old, and in desperate need of reform. In January, the United States failed to agree on funding measures that would have accomplished this, and so—seen through the lens of realpolitik—the AIIB only represents the United States reaping what it has sown.
Some concerns are valid. China’s aid policies lack transparency, notably regarding their form and amount. It is, therefore, reasonable to doubt the AIIB’s claim that it “will fully respect and draw upon the good practices of existing multilateral development banks,” as China’s Finance Minister said last Friday. But China’s aid practices should improve through the establishment of a formal bank in coordination with regional powers, not worsen. And so coordination, not fear, should be the path forward with the AIIB.