Sunday, March 22, 2015
Lagarde says IMF to co-operate with China-led AIIB bank
Christine Lagarde, the International Monetary Fund Chief, has voiced her support of the new China-led AIIB (Asian Infrastructure Investment Bank), stating that IMF would be delighted to cooperate with this venture. The bank, established in 2014, has already gotten 30 members and the backing of some strong economies like Germany, England and Italy. Mrs. Lagarde also believed that the World Bank would likely to cooperate with AIIB. On the other side, the US has voiced its criticism of England for backing the venture, stating it serves as "a lever for China to extend its influence over the region".
In my opinion, the ground of United States's concern is ambiguous, and other countries supporting this newly formed bank could actually open up a lot of investments projects for countries in Asia, especially countries with not as developed infrastructre that desperate needs capitals. With or without the bank, China influence on the region is more or less already established. This looks more like a knee-jerk reaction from the US than actual concern.
Source: http://www.bbc.com/news/business-32007090
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3 comments:
The idea of cross border investment to improve the underdeveloped or developing economies is beneficial for all parties. So, this venture seems great and the United States' concern does not seem important.
The U.S. National Security Council spokesman Patrick Ventrell stated that the U.S. opposes support to AIIB as they believe any new multilateral institution should be built on high political, environmental and socail standards such as the World Bank.
I wonder what shortcoming does the U.S. find in AIIB
Erica, this is mainly a political game between China and the US over control over the world capital market. China is dissatisfied with the World Bank and IMF's power arrangements. They formed this bank to serve as a counter to the US-led institutional framework, likely to force the US to reform these institutions more in China's favor. As such, the US would oppose support to the AIIB.
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