The Asian Infrastructure Investment Bank

Maintaining High Standards of Multilateral Infrastructure Financing

By Bo Lei

Bo Lei is a third-year student at Albany Law School. He is from China and is known on campus as Michael. He graduated from Rockefeller College of Public Affairs & Policy of SUNY at Albany with a Master's degree in Public Administration.
Prior to studying in the U.S., Michael graduated from Northwestern Poly-Technical University in China with a Master's degree in Computer Science and worked 8 years in ZhengZhou Commodity Exchange as an advanced programmer and an analyst of risks of futures market. He has been committed to expanding his knowledge to the profession of law to satisfy his strong interest in public affairs.
At Albany Law School, he served as a judicial intern in U.S. District Court for Hon. Daniel J. Stewart. He also served as an intern in various public sectors, including N.Y.S. Office of General Services, N.Y.S. Offices of the Inspector General, and the Empire Justice Center.
Michael is interested in public international law and originally prepared this paper for a course entitled International Business Transactions.
He prepared this paper for Prof. Halewood's course in International Business Transactions.


In March 2015, the Asian Infrastructure Investment Bank (“the AIIB”) dominated front-page headlines in most of the world’s important news media, not merely because of the bank itself, but more because the United Kingdom (U.K.) joined the AIIB as a founding member.   Following the U.K.’s decision, Australia and South Korea, the U.S.’s main allies in Asia, and other G7 countries such as Germany, France, and Italy, eventually announced their intention to join as well.

The U.S. opposed the establishment of the AIIB and had been attempting to lobby its allies not to join it.   Some deemed the AIIB a part of China’s plan to challenge the World Bank as well as the standing global financial order.   Others were concerned that the AIIB “would not live up to the ‘highest global standards’ for governance or lending.”

Why is the establishment of the AIIB so controversial?  What are multilateral infrastructure investment banks’ roles for regional and global development?  Would the AIIB challenge the global system of governance or supplement the existing system?  This paper discusses these questions from the perspective of global governance with respect to infrastructure investment, examines and compares measures and standards adopted by the AIIB and the Asian Development Bank (“the ADB”), analyses projects that have been approved by the AIIB, and will find that the AIIB supplements the existing system and maintains no lower standards of governance than the ADB does.
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To read the entire paper, open HERE.