Global Policy Volume 10 . Issue 4 .

November 2019
653

Is the AIIB a China-controlled Bank? China’s

Evolving Multilateralism in Three Dimensions
(3D)

Special Section Article

Jiejin Zhu
Fudan University

Abstract
Is the Asian Infrastructure Investment Bank a China-controlled bank? This basic question highlights the issue of the Asian
Infrastructure Investment Bank’s (AIIB) international credibility, especially as a multilateral institution. AIIB president Jin Liqun
recognized the ‘multilateral challenge’ for China from the outset of the planning to create the new Bank, and he understood
that the new Bank would only be a real success for China if the AIIB is truly a multilateral development bank – inside Beijing
circles, he added, ‘and only if the new Bank does better than the long-established counterpart MDBs’. These sentiments were
alluded to in Jin’s remarks in the Financial Times: ‘China benefited a lot from the existing international system. China needs to
do something which can help it be recognized as a responsible member and maybe a responsible leader in the future. . . if it
does well, that will enhance China’s credibility, but if this institution does not follow the international best practice, who will
believe in China in the future’. Skeptics, however, question whether it is ever possible that China will allow the AIIB to develop
into an actual multilateral bank.

Ever since China floated the AIIB proposal in 2013, the ques- interlocuter with the Bank. The main finding is that MoF has
tion of the AIIB being ‘China-controlled or not’ has emerged provided the AIIB the ‘strategic space’ it needs to foster its
as a key point of debate within international society. This multilateral character, and to sustain the growth of its multi-
essay challenges the notion that the AIIB is a China-con- lateral culture, and by extension, its international credibility
trolled Bank. It does so by exploring the nature of the rela- as a multilateral development bank.1 It is argued that Beijing
tionship between China and the AIIB. We examine whether, is doing so along three dimensions. First, during the estab-
or to what extent, China has supported multilateral engage- lishment phase for the AIIB, China’s Party and government
ment and cooperation within the AIIB; and whether China leaders supported the Chinese negotiators, and the AIIB
has only or mainly pursued its own national interests with Multilateral Interim Secretariat (tasked with establishing the
the AIIB, or whether it has, in key instances, sacrificed its AIIB, 2014–16) to enter into detailed multilateral negotia-
national interests in order to support the greater collective tions with the prospective members of the AIIB, from Asia,
good. We assess whether China is giving the AIIB the ‘space’ and then also from Europe, Africa and Latin America, with
to develop as a multilateral development bank, rather than the goal of building new multilateral consensus and agree-
treating it merely as a China-controlled Bank, or as some ment on the institutional design of the Bank. The multilat-
disparage, the Bank for the Belt & Road Initiative (BRI). eral discussions led to changes in China’s original designs
Actions speak louder than words, and the method used for the new Bank, and equally important, Chinese authorities
here is to examine China’s actions, its international behavior, also supported the legal codification of the arrangements
in creating the AIIB, and in managing its ongoing relations for the new multilateral bank.
with the AIIB. It is argued that China clearly played a strong Second, after the AIIB opened, and commenced with the
role in shaping the design and character of the AIIB at its operational phase, China has further supported the develop-
origins, and after the Bank opened, China’s influence has ment of the multilateral character and culture of the AIIB by
remained significant, though somewhat obscured and diffi- supporting the Bank to work within the ‘family’ of multilat-
cult to trace. Moreover, it is further suggested that China eral development banks (MDBs), by partnering with the
could dominate the AIIB, including through the use of its established MDBs, including the World Bank (WB), Asian
veto power on major strategic decisions, if it were to choose Development Bank (ADB), the European Bank for Recon-
to use this power. China’s latent power or capacity to domi- struction and Development, and other MDBs, to co-finance
nate is strong, and only time will tell whether China will projects, and conducting by human resources exchanges.
choose to do so in the future. But so far, China has exer- The preparatory discussions for these partnerships actually
cised restraint in dealing with the AIIB, especially China’s started in 2015, before the official launch of the AIIB in Jan-
Ministry of Finance (MoF), the main Chinese government uary 2016. Third, from 2017 onwards, Beijing has supported

Global Policy (2019) 10:4 doi: 10.1111/1758-5899.12763 © 2019 University of Durham and John Wiley & Sons, Ltd.
 Jiejin Zhu
654

further multilateralization of the AIIB by backing the Bank to Beijing did reduce its voice within the Bank when it agreed
join the collective effort to build a new multilateral coordi- to support the addition of non-regional members to be in
nation center for development finance, called the Multilat- the AIIB, but her main argument is that the new AIIB reflects
eral Cooperation Center for Development Finance (MCDF). what she sees as China’s more ‘assertive foreign policy pos-
The rest of this essay is organized into three sections. The ture’ under President Xi Jinping, that aims for the ‘great
next section details how China has helped to foster the rejuvenation of the Chinese nation’, and establishing a new
AIIB’s multilateral character during the establishment process ‘proper’ international order that reflects China’s great eco-
by supporting multilateral negotiations over the main pur- nomic and political weight, and its prioritization of Asian
pose and goals, rules, structure, and legal parameters for diplomacy (Yun, 2015).
the Bank, before the analysis turns to examining how China From a geo-economic perspective, several Chinese ana-
has further supported the multilateralization of the AIIB by lysts and foreign observers also argue that China wishes to
supporting the Bank’s partnership strategy with the existing use the AIIB to export its excessive industrial capacity and
MDBs, through co-financing large-scale infrastructure pro- promote the RMB internationalization (Lo, 2015). For exam-
jects. The third section examines another dimension of Chi- ple, Roach and colleagues suggested that the Chinese econ-
na’s support for the multilateralization of the AIIB, of omy has major overcapacity in many of its industrial sectors,
supporting the AIIB to join the MCDF. The analysis underli- and AIIB is in part designed to create opportunities for Chi-
nes that the AIIB, as a newly created international financial nese state-owned companies to ‘go abroad’ by expanding
institution backed by a rising power, faces a dilemma that is their access to new external markets. In addition, the AIIB
not easily resolved, between, on the one hand, needing to can help the Chinese government to diversify its invest-
foster international legitimacy and multilateral credibility, ment, and also to promote the internationalization of RMB
and on the other hand, pursuing innovation or new ways of (Roach et al., 2015).
doing things. From a geo-political perspective, some people argued that
the AIIB would be used by China as a diplomatic tool to
‘subsidize’ the countries that are friendly toward China in
Multilateral negotiations for the AIIB’s
the escalating US-China competition in the Asia Pacific area,
establishment
following the Obama administration made its ‘Pivot to Asia’
The specific proposal for the Asian Infrastructure Investment (Keck, 2014). Sun Yun writes similarly that, with the AIIB,
Bank was put forward by Chinese President Xi Jinping dur- China can strengthen economic interdependence with its
ing a visit to Indonesia in Southeast Asia, and he spoke to neighbors, and increase its leverage in settling disputes in
the infrastructure needs of Asia: ‘At present, Asian countries, the South-China Sea (Yun, 2015).
especially emerging economies and developing countries, These interpretations raise doubts about the AIIB’s inter-
are in great financial need to develop infrastructure. Particu- national credibility as a multilateral institution, and may
larly in the face of such severe challenges as mounting have temporarily halted the growth of its membership
downward pressure and financial volatility, it is necessary to within the Asian region. By 24 October 2014, only 22 coun-
mobilize more funds for infrastructure development to tries had signed the memorandum of understanding (MOU)
maintain sustained and steady economic growth and pro- to establish the AIIB, including Bangladesh, Brunei Darus-
mote connectivity and economic integration in the region. salam, Cambodia, China, India, Indonesia, Kazakhstan,
China proposes to establish a new Asian Infrastructure Kuwait, Lao PDR, Malaysia, Mongolia, Myanmar, Nepal,
Investment Bank’.2 Oman, Pakistan, Philippines, Qatar, Singapore, Sri Lanka,
But skeptics have charged that China is not motivated by Thailand, Uzbekistan, and Vietnam. Except China, Singapore
a desire to help other developing and emerging countries, and Qatar, the rest of the signatories were borrowing and
but rather that the AIIB is an instrument for control by the developing countries in South, Southeast, and West Asia.
Chinese government. Is this so? China’s proposal was wel- Major and more developed economies within the region,
comed by the developing countries from South-east Asia, including Japan, Korea, Australia, Russia, initially sat on the
South Asia and Central Asia, but met by skepticism from the sidelines. Japan refused to join despite the outreach by Chi-
non- Asian developed countries, especially in Europe and nese diplomats several times, each time expressing con-
North America. One of the criticisms was that the AIIB would cerns about the AIIB’s governance and transparency, and
merely be an instrument of Chinese government control. more indirectly, Tokyo’s concerns about possible competi-
Lawrence Summers, former US treasury secretary, suggests tion with the ADB. The US repeatedly voiced its concern
that AIIB was China’s direct response to the US congress that the AIIB would lower the international standards of the
rejecting the 2010 IMF reform agreement which would have WB and the ADB, and also discouraged its Asian allies not
greatly increased China’s share (Summers, 2015). Sun Yun, to join, including Australia and South Korea (Ba, 2017).
for example, addresses the perception of Chinese control, Although China and the AIIB interim secretariat tried to
noting that China is the largest shareholder of the Bank, allay concerns, and rebut the criticisms, initially, the US and
and its headquarter is in Beijing, and its president a Chinese Japanese accusations and Washington’s warnings against
citizen, and that analysts in the developed countries think joining did cast doubt onto the Chinese and AIIB interim
that China has both geo-economic and geo-political strate- secretariat’s efforts to establish the international credibility
gies behind the AIIB proposal. Sun Yun acknowledges that of the new Bank.

© 2019 University of Durham and John Wiley & Sons, Ltd. Global Policy (2019) 10:4
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However, the situation evolved rapidly from late 2014 to missed in the assessments to date of the AIIB, which have
early 2015. In particular, the AIIB received a boost of interna- instead emphasized that the ‘international community’
tional legitimacy and credibility when on 12 March 2015 the forced Beijing to change its positioning on the AIIB (Yun,
UK government announced it would be the first major 2015). According to Thomas Schelling’s theory of credible
developed country in the West to seek to join the AIIB. The commitment, if one actor in a negotiation can constrain
UK Chancellor of the Exchequer, George Osborne itself, for example, by narrowing options, its commitment
announced that the UK ‘intends to become a prospective will be more credible (Schelling, 1960). Schelling’s theory
founding member of the AIIB’, and he also declared that ‘UK can be applied to the negotiations over the AIIB Articles of
will play a key role in ensuring that the AIIB embodies the Agreement, especially the negotiations with the European
best standards in accountability, transparency and gover- nations, when China made several concessions to constrain
nance, which will be essential to ensuring the success of the its power in exchange for the European governments to
initiative and to unlocking the potential benefits for the agree to join. In constraining itself, Beijing also helped to
wider global economy’ (Osborne, 2015). The US administra- foster the multilateral credibility and legitimacy of the new
tion made clear its displeasure about Osborne’s decision to Bank. For example, on China’s quota share and voting share,
join the AIIB, with one US official telling the Financial Times: certain European representatives voiced the view that China
‘We are wary about a trend toward constant accommoda- really needed to give up the veto in order for the Bank to
tion of China, which is not the best way to engage a rising be taken seriously as a multilateral development bank (Wei
power’ (The Guardian, 2015). Despite the push-back from & Davis, 2015). In response, and enshrined in the Articles of
the US, the UK’s decision to join set in motion a wave of Agreement, China agreed to reduce its quota share to 30.34
other membership applications, including Germany, France, per cent, and a voting share of 26.06 per cent. Skeptics and
Italy, Switzerland, Russia, South Korea, Australia, Brazil, Tur- critics then highlight that even with its reduced quota and
key. According to Zhao Ke, a Chinese European studies voting shares, China still retains a veto on the major strate-
scholar, the decision of the European powers to join the AIIB gic decisions of the Bank. However, what has been missed
was their new engagement strategy, in which they would or ignored in the published analysis is that China did also
corral the AIIB, and keep it within the existing international agree, verbally, to give up its veto power, ‘gradually’, within
liberal order, and global financial system (Zhao, 2015; see the AIIB. On 29 June 2014, Chinese Finance Minister Lou
the Gabusi essay which details the European intentions). Jiwei is quoted saying that China’s quota could have been
Jin Liqun, president of the AIIB, has noted that the Chi- more than 50 per cent, in that China was willing, and that
nese government originally expected that approximately 20 such as a large financial contribution was not a sign of Chi-
countries would join the new Bank, and probably only na’s desire to dominate the new Bank, but a reflection of
developing countries in East Asia, South Asia and Central China’s determination to establish the Bank. However, he
Asia (Hu, 2016). But by the ‘founding membership’ deadline then stated that if more countries were willing to join,
of 31 March 2015, 57 countries had signed up, including 37 including the US and Japan, then China would reduce its
Asian countries and 20 non-Asian countries, and with a mix quota and voting shares accordingly, including below the
of developed and developing countries in each group. The level of the veto.3 Beijing actually offered a political compro-
number was much larger than initially expected, and was mise of sorts: on one hand, China still retains the veto dur-
widely seen as a victory of Chinese economic diplomacy ing the formative stage of the Bank’s operation; and on the
(White, 2015). However, the dramatic expansion in the AIIB’s other hand, China has offered to give up the veto when
membership also involved China facing group pressure from more new members join the bank by introducing a ‘fixed’
the European governments, who negotiated as a grouping, special majority, comprising two-thirds of the number of
and they pressed Beijing to make a number of concessions members and representing three-quarters of the voting
in order for the European governments to agree to join. As power.4 In contrast, the United States has maintained its
such, these negotiations took on a multilateral quality from veto power in the World Bank by amending the articles of
the start, in which China ended up in a give-and-take bar- agreement. This increased the special majority needed to
gaining. override the US veto even when the voting power of the US
In the course of these negotiations, China essentially was reduced after new members were added (Fu, 2016).
agreed to ‘tie its hands’, by reducing its quota allocation On governance structure, initially the Chinese design was
and its capital contribution to the Bank, and reducing its for the Board of Directors (BoD) to supervise the manage-
voting share, and by agreeing to the European demands for ment and the operation of the Bank on a regular basis, but
high standards of transparency and oversight in the gover- for the BoD to be non-resident. The Chinese had made the
nance and management of the Bank, and by accepting glo- observation from the experience of many existing MDBs that
bal best practices for environmental and social standards when Directors are full-time resident, it can lead to problems
and safeguards. In return, Beijing insisted and gained agree- of duplication of oversight and unclear division of authority
ment from the Europeans, that the influential Board of between the management team and the Board, with the
Directors be non-resident, as Chinese officials and Jin Liqun, Board members wanting to make policy and approve pro-
the president of the AIIB originally envisioned (Wilson, jects. The Chinese emphasized that accountability on Board
2019). The deeper significance of Beijing’s concessions, in decisions was not straight-forward when Board members
terms of building multilateral credibility has seemingly been made mistakes with their decisions. As such, China initially

Global Policy (2019) 10:4 © 2019 University of Durham and John Wiley & Sons, Ltd.
 Jiejin Zhu
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proposed to increase the accountability of the management Multilateral partnering

team, especially for the Bank’s operations, and to reduce ‘un-
necessary interference’ by the BoD on the Bank’s operations. A second dimension of China’s support for the multilateral-
However, the Europeans were concerned that a non-resident ization of the AIIB is its support to the Bank to join the so-
Board would be unable to truly supervise the management called ‘family’ of MDBs, specifically by supporting the AIIB to
team; and the related concern was that the Board members work with other MDBs on the big infrastructure projects,
would not be able to supervise the senior management of including the World Bank Group, Asian Development Bank,
the Bank which would be headed by a Chinese national. The European Investment Bank, and European Bank for Recon-
not so hidden concern was that of excessive Chinese govern- struction and Development, to co-finance large-scale infras-
ment influence of the Bank’s senior management. tructure projects.
In the course of these governance negotiations, the main On 13 April 2016, AIIB and World Bank signed a co-financ-
negotiating parties made concessions: on one hand, it was ing framework, outlining the co-financing parameters of
agreed that the BoD would be non-resident and responsible AIIB-World Bank investment projects. Under the agreement,
for supervising and overseeing the general operations of the the World Bank agreed to prepare and supervise the co-fi-
Bank, but the Board would delegate project approval power nanced projects in accordance with its own policies and
to the senior management on projects inside the Asian procedures in areas like procurement, environment and
region; on the other hand, it was agreed that the BoD social safeguards.5 In June 2016, the AIIB announced it
would supervise the Bank’s management by establishing the would invest in the Indonesia National Slum Upgrading pro-
‘Compliance, Effectiveness and Integrity Unit’, as a unit to ject, co-financed with International Bank for Reconstruction
evaluate the management, but that is separate and inde- and Development (IBRD)/World Bank (WB), with each Bank
pendent from the management team, and reports directly respectively contributing US$216.5 million. The AIIB agreed
to the BoD. China further agreed that on investment deci- that the WB would administer the loan, and that the entire
sion-making, the AIIB president would work through the project would be implemented according to the WB’s envi-
Executive Committee and an Investment Committee. In the ronmental and social compliance and project monitoring
AIIB project approval process, for projects in Asia, if a pro- and reporting procedures. Procurement would also be con-
posal passes the initial project identification and due dili- ducted in accordance with the WB’s Procurement and Con-
gence assessment process conducted by the Project Team sultant Guidelines (dated January 2011, and revised July
and by the risk and sector professionals, the Executive Com- 2014). The AIIB accepted the WB’s ESSP, to quote the AIIB
mittee discusses whether the project meets the basic project document: (i) ‘they are consistent with AIIB’s Articles
screening criteria of the Bank, and then the Investment of Agreement and materially consistent with the provisions
Committee does the final review of the project proposal, for of AIIB’s Environmental and Social Policy and relevant Envi-
due diligence, and project viability. Although the President ronmental and Social Standards’; and (ii) ‘the monitoring
chairs the two Committees, decision-making on projects procedures that WB has in place to ascertain compliance
assessments is by consensus, which means the president with WB ESSP are appropriate for the project’ (AIIB, 2016a).
alone cannot make the decision. If the proposed project is On 2 May 2016, AIIB signed an MOU with ADB, setting the
outside of the Asia region, but has links to the region, the stage for jointly financing projects. The two banks agreed to
final decision is made by the BoD. strengthen project co-financing cooperation, including
For the Europeans and the other Bank members, it was energy, transportation, telecommunications, rural and agri-
very important that these negotiations were multilateral. culture development.6 Also announced in June 2016, Pak-
Equally important for the Europeans, China supported the istan National Motorway M-4 (Shorkot-Khanewal Section)
legal codification of the multilaterally-negotiated rules, terms Project was the first co-financed project between the AIIB,
and conditions for the Bank, which took the form of a legal ADB, and the Department for International Development
Charter for the new Bank, and precise ‘Articles of Agree- (DfID) of the UK. The AIIB and ADB each contributed US$
ment’ (see the Lichtenstein essay in this collection). These 100 million, and the DFID US$34 million. The AIIB agreed
multilateral negotiations, their successful conclusion, and the that the project would use ADB’s safeguard policy statement
legal codification of the agreements, helped to secure the (2009) (ADB SPS). To quote the AIIB project document, the
dramatic increase in the AIIB’s membership, especially the AIIB also agreed to use ADB’s standards, as they are: (i) ‘con-
addition of the key non-regional members in Europe. sistent with the AIIB’s Articles of Agreement, and materially
AIIB President Jin Liqun has stated that, in the process of consistent with the provisions of the AIIB’s Environmental
setting up the AIIB, both China and the AIIB have gained and Social Policy and relevant Environmental and Social
international credibility, and built mutual trust through col- Standards’; and (ii) because the ‘monitoring procedures that
lective consultation, and by making decisions through ADB has in place to ascertain compliance with the ADB SPS
clearly defined and democratic procedures (Fu, 2016). In are appropriate for the project’ (AIIB, 2016b).
brief, the multilateral negotiations of the rules, terms and On 11 May 2016, AIIB also signed a MOU with the Euro-
conditions, and structure of the AIIB, their codification in the pean Bank for Reconstruction and Development (EBRD),
Articles of Agreement, helped to build the AIIB’s interna- which set out a framework for strategic and operational
tional credibility as a multilateral development bank, and cooperation in joint infrastructure projects in Central Asia.7
the beginnings of the multilateral culture of the Bank. AIIB approved a loan of US$ 27.5 million for Dushanme-

© 2019 University of Durham and John Wiley & Sons, Ltd. Global Policy (2019) 10:4
 China’s Evolving Multilateralism
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Uzbekistan Border Improvement Project on 24 June 2016. development partners to support the BRI, including informa-
The project was co-financed with the EBRD, which con- tion sharing, capacity building and project preparation’
tributed US$ 62.5 million, for a project with a total cost of (Zhang, 2019).
US$ 105.9 million. The AIIB agreed that the project would The 2019 MDCF MOU actually builds on an earlier MOU in
use the EBRD’s Environmental and Social Policy (2008) (EBRD May 2017 between China’s finance ministry and six MDBs,
ESP) and the EBRD’s procurement policy and procedures the WB, ADB, European Investment Bank, EBRD, AIIB and
(AIIB, 2016c). By the end of 2018, AIIB had approved 35 pro- New Development Bank, to consideration their collective
jects for infrastructure, of which 21 projects are co-financed cooperation on ‘shared interests’ under the BRI. It can fur-
with the World Bank, Asian Development Bank, and the ther be said that the MCDF agreements have built on even
European Investment Bank and European Bank for Recon- earlier commitments, in 2016, at the G20 Leaders Summit in
struction and Development – or what amounts to about 60 Hangzhou, China, at which Chinese officials used their host
per cent of the AIIB’s project investment up to that point in presidency of the summit to encourage more internation-
time.8 Most importantly, co-financing means not only the ally-shared investment in the Global Infrastructure Connec-
joining of money between the banks but also potentially tivity Alliance (GICA), which is led by the World Bank Group,
the AIIB’s internalization of the policy and standards of the and has China as a major donor (Chin and Dobson, 2015).
established MDBs. Drawing from sociology, one could At those meetings in Hangzhou, China pushed 11 MDBs,
hypothesize that the AIIB has been undergoing processes of including the AIIB to give more investment support to
‘socialization’, in other words, internalizing the norms and infrastructure.9
ideologies of the existing MDBs. Whether such socialization At the fourth AIIB annual meeting, in July 2019, in Luxem-
of the AIIB is happening, and if so, to what degree, would bourg, Liu Kun, Chinese finance minister, said that the AIIB
be an important area of future research, as it would tell us ‘should actively join the MCDF’, and play a key role in sup-
whether the AIIB has mainly been engaging in socialization, porting the EU-China strategy of ‘connecting Europe and
and potentially at the cost of pursuing innovation and new Asia’ and the BRI.10 This dual agenda suggests that the Chi-
ways of doing things. The decision of the AIIB to accept the nese finance ministry is treating the AIIB as one of its inter-
standards of the established MDB, when co-financing pro- national development partners, rather than merely as an
jects together, would only be the first step in such a social- international financial institution which it directly controls.
ization process. The key next question or issue for inquiry is Skeptics argue, however, that these multilateral diplomatic
whether the AIIB uses the ESSs of the World Bank Group, gestures are largely about China wanting to avoid the per-
the ADB, the EBRD, and other MDBs for its own (AIIB) solely- ception that the AIIB is a tool of the BRI, and Beijing used a
financed projects, or whether or the degree to which the global forum, the G20, to push a global message, which also
AIIB develops and institutionalizes its own ESSs for its own encompassed what it was suggesting that the AIIB should
projects. do. The BRI, and its relationship with the AIIB, is an optimal
test case for whether the AIIB is a China-controlled bank.
Raffaello Pantucci, a Researcher at Royal United Services
New multilateral platform
Institute, argues that the AIIB is a tool of the BRI – and by
A third dimension China’s support for the multilateralization extension, a tool of the Chinese government – rather than a
of the AIIB, and one that is also related to the second multilateral development financing institution, that pursues
dimension of the AIIB joining the family of MDBs, is Beijing’s a collective or common purpose, because 75 per cent of the
support for the AIIB to be included in a newly created multi- AIIB’s first projects are devoted to countries along the BRI
lateral platform, the ‘Multilateral Cooperation Center for routes (Pantucci, 2016).
Development Finance’ (MCDF; see the Chin Introduction In reality, there is overlap between the AIIB and BRI, but it
essay for this collection). is not accurate to call the AIIB the BRI Bank. Jin Liqun, the
In April 2019, at the Second Belt & Road Forum, in the AIIB president, has acknowledged that the AIIB and the BRI
outskirts of Beijing, a group of eight MDBs and China’s Min- were both initiated by China, and at about the same time
istry of Finance agreed to commence with the creation of period, and they share similar purposes; however, Jin
the MCDF, and the AIIB is one of the core member institu- emphasizes that they are ‘distinct and separate entities. As a
tions. According to the MOU, signed in March 2019, the high-standard international organization, AIIB has its own
MCDF is intended to promote collective infrastructure standards in choosing the projects, including the debt sus-
investment, from this MDB grouping, as well as facilitate the tainability, environmental protection and local people sup-
exchange of information among its members, strengthen port’ (Jin, 2019). Joachim von Amsberg, AIIB vice president,
the institutional capacity of developing countries to control further explained the connection and difference between
their investment climate and improve the transparency of AIIB and BRI, ‘if a project comes to you and it is Belt and
their debt management and project preparation. The Chi- Road Initiative, are you going to invest it? Well, we could,
nese government wants the MCDF to support the BRI. For but just because it is BRI doesn’t mean we will’ (Amsberg,
example, Zhang Wencai, director general of the Department 2017).
of International Economic and Financial Cooperation at Chi- Chinese officials are also aware that the AIIB must demon-
na’s Ministry of Finance, stated that the purpose of the strate that it has policy and operational autonomy, and that
MCDF is to ‘organize the eight MDBs and other international it is not a tool of the BRI. For now, it is possible to say that

Global Policy (2019) 10:4 © 2019 University of Durham and John Wiley & Sons, Ltd.
 Jiejin Zhu
658

the decision to create the MCDF was only announced Data availability statement
recently, in July 2019, and that the MCDF remains more of a
promise than a reality – and the exact relationship between I confirm that my article contains a Data Availability State-
the MCDF and the BRI is still to be defined. Nonetheless, the ment even if no data is available (list of sample statements)
decision to commence with creating the MCDF is suggestive unless my article type does not require one.
of multilateral intentions, as is Beijing’s support for the AIIB
to be a member of the MCDF. Only time and actions will
truly tell whether Beijing will restrain its power and influ-
Notes
ence in relation to the MCDF and the AIIB, including with 1. Jin Liqun is quoted in James Kynge, ‘AIIB Chief Unveils Aim to Rival
respect to BRI projects. Lenders such as ADB and World Bank’, Financial Times, 4 May 2017
[online]. Available from: https://www.ft.com/content/3a938ee4-0288-
11e7-aa5b-6bb07f5c8e12 [Accessed 20 August 2019]
Conclusions 2. ‘China Proposes an Asian Infrastructure Investment Bank’, China
Daily, 3 October 2013 [online]. Available from: http://www.chinada
Compared with other China-backed international initiatives, ily.com.cn/china/2013-10/03/content_17007977.htm [Accessed 26
such as the BRI, the AIIB has developed or gained a fairly August 2019]
high level of international credibility, as a multilateral organi- 3. ‘Lou Jiwei responds to reporter’s questions on AIIB preparations’
zation, and sooner than many observers predicted. It has [online]. Available from: https://www.mof.gov.cn/mofhome/guojisi/
been suggested that a key factor in this legitimization pro- pindaoliebiao/gongzuodongtai/201406/t20140630_1106322.html
[Accessed 20 August 2019]
cess is that China has restrained itself from intervening uni-
4. AIIB, Articles of Agreement, Article 28, Clause 2(ii) [online]. Available
laterally in its dealings with the AIIB, and has supported the from: https://www.aiib.org/en/about-aiib/basic-documents/_download/
multilateralization of the AIIB, during the negotiations for articles-of-agreement/basic_document_english-bank_articles_of_agree
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Schelling, T. (1960) The Strategy of Conflict. Cambridge, MA: Harvard Author Information
University Press.
Jiejin Zhu is an Associate Professor at the School of International Rela-
Summers, L. (2015) ‘A Global Wake-up Call for the US?’, The Washington
tions and Public Affairs, Fudan University. His research focuses mainly
Post, https://www.washingtonpost.com/opinions/a-global-wake-up-ca
on international organization and global governance, especially China’s
ll-for-the-us/2015/04/05/6f847ca4-da34-11e4-b3f2-607bd612aeac_
relations with international and regional organizations. He is finishing a
story.html [Accessed 16 September 2019].
book manuscript on China’s Rise and International Institutional Change.

Global Policy (2019) 10:4 © 2019 University of Durham and John Wiley & Sons, Ltd.