Asian Infrastructure Investment Bank - Definition
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Asian Infrastructure Investment Bank (AIIB)
The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank whose mission is to offer financial support or aid for infrastructural projects in the Indo-Pacific region; Asia. AIIB was established to address the infrastructure deficiency experienced by Asian countries and to also stimulate social and economic growth in the region.
A Little More on What is the Asian Infrastructure Investment Bank (AIIB)
The Asian Infrastructure Investment Bank (AIIB) commenced operations in January 2016. This development bank isheadquartered in Beijing and has a growing membership of over 100 members worldwide. The core mission of the AIIB is to improve infrastructure, social and economic growth of countries within the Asian region and beyond. AIIB invests in the sustainable development of member countries and also provides technical support to countries in terms of infrastructural growth.
The History of the Asian Infrastructure Investment Bank
Before the Asian Infrastructure Investment Bank (AIIB) was finally established in January 2016, there are certain discussions and activities that led to its creation. The Asian Infrastructure Investment bank was first mentioned by Xi Jinping, China's leader at an APEC summit in 2013. However, when it was proposed, observers thought it was going to favor the Chinese government only and also challenge international investment banks and lending institutions. Also, because it was proposed that China would hold half of the voting shares of AIIB, its standards and good governance were questioned by the American government. Despite the objections of the U.S, AIIB was signed by almost all Asian countries, as well as half of NATO, which led to its establishment in 2016.
The Structure of the Asian Infrastructure Investment Bank
AIIB is controlled and headed by a Board of Governors and a Governor appointed and alternated between the member countries of AIIB. The bank has a Board of Directors which has the duty of formulating strategies, write annual plans and budgets of the bank and also perform oversight functions. AIIB has staff members which are headed by President. The president emerges by election and has a five-year tenure after which another election is conducted. A president can vie for a re-election after completing the first term.
Asian Infrastructure Investment Bank Priorities
There are several projects that the Asian Infrastructure Investment Bank (AIIB) prioritises, these are;
- Environmental projects.
- Building, road, railway, ports, pipeline projects and other development plans.
Projects that connect two or more countries are of priority to AIIB, these includes railway construction that will link a substation in one country to a substation in another, telecommunications projects, road constructions, among others. As a multilateral development bank, AIIB partners with other development banks, private financiers, world billionaires and even the government for execution of projects.
Reference for Asian Infrastructure Investment Bank (AIIB)
https://aiib.org/https://en.wikipedia.org/wiki/Asian_Infrastructure_Investment_Bankhttps://www.investopedia.com Investing International / Globalhttps://www.brookings.edu/opinions/the-aiib-and-the-one-belt-one-road/https://www.scmp.com/topics/asian-infrastructure-investment-bank
Academic research on Asian Infrastructure Investment Bank (AIIB)
Why Did China Take the One Belt and One Road (OBOR) Strategy and Initiate theAsian Infrastructure Investment Bank(AIIB)?, KON, M., HSU, S. M., & KUNG, L. S. (2016). Why Did China Take the One Belt and One Road (OBOR) Strategy and Initiate the Asian Infrastructure Investment Bank (AIIB)?.International Journal of Economics, Commerce and Research (IJECR),6(2), 39-54.Planning for a Sustainable Belt and Road Initiative (BRI): An Appraisal of theAsian Infrastructure Investment Bank(AIIB) Environmental and Social Safeguards, Brombal, D. (2018). Planning for a Sustainable Belt and Road Initiative (BRI): An Appraisal of the Asian Infrastructure Investment Bank (AIIB) Environmental and Social Safeguards. InNormative Readings of the Belt and Road Initiative(pp. 129-145). Springer, Cham. The Belt and Road Initiative (BRI) has been hailed by many as a game changer in the field of economy, capable to sustain growth in the Eurasian region. Many observers however are concerned about the environmental and social costs of the initiative. To what extent the BRI will pursue a development in tune with the environment and the needs of affected communities will largely depend upon the capacity of concerned actors to carry out integrated and inclusive environmental and social planning. A major role will be played by financial institutions funding the initiative. This chapter seeks to appraise the rationale, scope, legitimacy, and decision-making implications of environmental and social policies applicable to BRI projects. To pursue this aim, the Asian Infrastructure Investment Bank (AIIB) is taken as a case representative of current progress and challenges ahead. Findings indicate that AIIBs environmental and social safeguards may constitute a tool to promote social inclusion and environmental protection within BRI projects. However, their effectiveness will depend from the Banks political commitment towards sustainability and its capacity to foster institutional change in client countries. Asian Infrastructure Investment Bank(AIIB), Palgrave Macmillan. (2016). Asian Infrastructure Investment Bank (AIIB).The Statesmans Yearbook: The Politics, Cultures and Economies of the World 2017, 69-69. The Chinese government announced proposals for the establishment of the Asian Infrastructure Investment Bank in Oct. 2013. Articles of agreement, which form the banks legal basis, were adopted in May 2015 and the institution was formally launched in Dec. that year, with an initial capitalization of US$100bn. TheAsian Infrastructure Investment Bank(AIIB) Enigma, Ku, H. (2015). The Asian Infrastructure Investment Bank (AIIB) Enigma.Available at SSRN 2684033. The Asian Infrastructure Investment Bank (AIIB) is the latest addition to an existing block of international financial institutions with the objective of providing infrastructural developmental funding to member nations. Incumbent players including the International Monetary Fund (IMF), the World Bank and the Asian Development Bank (ADB) are all dominated by countries such as the United States for the Western countries in the IMF and World Bank and Japan for the Asian Development Bank (ADB) in the APAC region. The genesis of the Asian Infrastructure Investment Bank (AIIB) has been met with mixed reactions by different audiences across the globe, due to the founding nations (Peoples Republic of China) international perception in the zeitgeist. Are the optimism premature or such skepticism unfounded and bias? On Fishing, Learning to Fish and Aquaculture: TheAsian Infrastructure Investment Bank(AIIB) as a Multilateral Development Financial Institution, Feteira, L. T. (2017). On Fishing, Learning to Fish and Aquaculture: The Asian Infrastructure Investment Bank (AIIB) as a Multilateral Development Financial Institution. The Asian Infrastructure Investment Bank (AIIB) was established on 24 October 2014 on the basis of a Memorandum of Understanding of Establishing AIIB signed by 22 prospective founding members, including China as the largest contributing member. According to its articles of agreement, the AIIB aims to foster regional development through a combination of investment on infrastructure and other productive sectors, with the promotion of regional cooperation and partnership. As far as multilateral development financial institutions go, the AIIBs take on the promotion of development is somewhat distinct and therefore noteworthy, targeting poverty alleviation indirectly through financing of key-economic areas, most notably infrastructure. More broadly, the AIIB is a pivotal element of the Belt and Road Initiative (BRI), coomonly referred to as the (new) Silk Road, and its particular features should be seen at this light. The purpose of this contribution is to provide a brief comparison with existing multilateral development financial institutions affiliated to the World Bank Group with the novel AIIB taking into the account the latters function in the implementation of the BRI. Asian Infrastructure Investment Bank(AIIB) as an Instrument for Regional Leadership of China in the East Asia Region, Raharyo, A. (2018). Asian Infrastructure Investment Bank (AIIB) as an Instrument for Regional Leadership of China in the East Asia Region.AEGIS: Journal of International Relations,2(2). The establishment of the Asian Infrastructure Investment Bank (AIIB) has sparked many debates and controversies in the last five years since it was announced back in 2013. Amongst studies trying to explain the reason for the establishment of the AIIB, most of them are based on the analysis of Sino-U.S. relations especially on how they overlooked China as a replacement for global hegemon to the U.S.However, considering Chinas foreign policy in the recent decade, the establishment of the AIIB is considered as a typical step to becoming a leader in regionalism of East Asia. This writing concludes that China is still only aiming to become regional leader in the scale of East Asia.