U.S. Isolated and Embarrassed in Asian Investment Bank Deal
Many of America’s closest allies have chosen to become founding members of the China-led Asian Infrastructure Investment Bank, known as the aiib. The bank is expected to fund major energy, communications and transportation projects in Asia.
Traditionally close American allies Japan and South Korea chose to join even after Washington’s requests that they boycott China’s invitation.
And those weren’t the only ones. The United Kingdom, France and Germany also signed up despite U.S. protests and concerns about the bank’s governance. When the UK announced earlier this month that it would join the aiib, the White House issued a sharp criticism, demonstrating a rare policy rift between the two allies.
These nations are joining the aiib to develop greater trade and investment with China. And they are willing to do so despite U.S. protests.
Executive vice president of the Asia Society Tom Nagorski explains:
SOUNDBITE: “The United States is or has been isolated by this. I think because it came out of gates as not really, appearing any way, to be willing to talk about all of this, but just in opposition, on the face of it, to the creation of this China-led institution.”
The U.S. claims the aiib will undermine the authority of the International Monetary Fund. It says the bank will weaken the Trans-Pacific Partnership the U.S. is promoting to bolster trade around the Pacific. South Korea has hesitated to join this partnership.
The criticism turned into embarrassment for the U.S. when imf managing director Christine Legarde assured China that the imf would cooperate with the aiib.
The U.S. Congress has avoided approving a package of reforms to the imf agreed to back in 2010. The reforms would give China and other emerging nations a greater say in decision making. This has given the creation of the aiib greater momentum as an alternative bank.
The creation of this new bank proves that America’s “pivot to Asia” is not working. The Trumpet has forecast the decline of America’s influence in the region. For more information on this trend, request our free booklet Russia and China in Prophecy.