China Global Newsletter | Edition 5: December 2021

The Asian Infrastructure Investment Bank

In 2013, China announced that it planned to establish the Asian Infrastructure Investment Bank (AIIB). This was followed by intense speculation around which countries would join, how closely the new institution would follow the path set by already established multilateral development banks, and what role China would play in its governance. Human rights advocates and environmentalists in particular were concerned that gains made in advocating for accountability in development finance over the past decades would be undermined by the AIIB, generating a new race to the bottom in social and environmental standards.

Initially at least the AIIB has taken a relatively cautious path. It commenced by largely co-financing projects with other multilateral development banks, applying their standards and grievance mechanisms, and invested in traditional infrastructure projects such as roads, power plants and transmission. As the bank got into its stride, it began developing its policies and strategies and building a more complex portfolio. This edition of the China Global Newsletter takes stock of the bank, looking at where it stands six years on from its establishment. It covers:

• Putting the AIIB in context
• How “Green” is the AIIB?
• AIIB’s Environmental and Social Framework
• Indirect financing: A high-risk approach
• Safeguarding the rights of those impacted by AIIB projects