At its inaugural annual meeting in Beijing, China, this week, the Asian Infrastructure Investment Bank — the world’s newest multilateral institution — will bid to position itself as a leader in Asia-Pacific development financing.
The establishment and operations of AIIB have been an anticipated event in the global development community. Some experts and development leaders initially expressed concern about the intent of the Chinese-led financial institution, and particularly on how much influence the Beijing government has over the bank and the kind of safeguards framework it plans to implement once infrastructure projects start rolling out.
But six months after opening, the AIIB’s first annual meeting will seek to demonstrate the $100 billion bank’s seriousness in making a difference in the lives of the people it wants to help — and give a glimpse of how it will operate in the years to come.
The event, with the theme of “partnership for infrastructure development,” is expected to draw hundreds of development leaders, civil society representatives and private sector players to discuss how to bridge the infrastructure investment gap in the region — estimated by the Asian Development Bankto be about $800 billion per year until 2020 — in a sustainable and resilient manner.
“Major decisions at multilateral institutions typically are negotiated in advance of an annual meeting by major stakeholders,” Curtis Chin, former U.S. ambassador to the Asian Development Bank, told Devex. “It will be interesting to see how the AIIB annual meeting plays out given China’s dominant shareholder role.”
Projects and partnerships
AIIB President Jin Liqun is expected to announce his institution’s first batch of infrastructure projects and loans, making use of its $100 billion in paid-in capital.
Utilizing a partnership and co-financing strategy, according to Chin, is an ideal move for the world’s newest development player — and likely to continue at least in the immediate future. The bank can benefit from other multilaterals’ expertise and experience in implementing development projects, especially in the area of environmental and social safeguards.
“On paper at least, AIIB has begun to address these concerns including through co-financed projects with the World Bank and ADB,” he said. “The test for AIIB remains in the interpretation and implementation of its policies.”
Infrastructure and China’s role
The two-day event includes seminars focused on infrastructure and global economic growth, as well as the role of multilateral development banks in financing green infrastructure.
Another seminar will discuss the huge demand for infrastructure investment in the region and how multilateral institutions such as AIIB can help patch these holes. Discussion will also focus on how the private sector can play a crucial role in building and financing infrastructure development in the region while remaining profitable. A further panel discussion will explore how to pursue infrastructure projects with a focus on the recently adopted Paris climate agreement.
The presence of Chinese Finance Minister Lou Jiwei and People’s Bank of China Chief Economist Ma Jun among the key speakers has also draw attention to the growing role and stature of China in global economic growth and international development.
Other buzz topics
Other topics buzzing through discussions at the China World Hotel include procurement opportunities for businesses and private sector players outside of China and the region. Stakeholders will also likely take stock of AIIB’s progress in its early operations.
The annual meeting can also give a glimpse of how much the bank will play a part — and how much it will not — in the Chinese government’s One Belt One Road initiative to connect the mainland to the rest of Asia, Europe and Africa through a series of roads, highways and maritime routes.
A significant number of civil society representatives are expected to attend the meetings and express their concerns on the consultations, transparency and accountability of the bank’s various policies and operational functions.
“AIIB leadership could do more to reach out to civil society and to engage meaningfully with a wide range of stakeholders,” Chin said. “Meaningful engagement … can ultimately lead to stronger on-the-ground support for the institution and its projects.”
Stay tuned for more Devex on-the-ground coverage of AIIB’s inaugural annual meeting in Beijing, China, from June 25 to 26.
Lean Alfred Santos is a Devex development reporter focusing on the development community in Asia-Pacific, including major players such as the Asian Development Bank and the Asian Infrastructure Investment Bank. Prior to joining Devex, he covered Philippine and international business and economic news, sports and politics. Lean is based in Manila.
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