The long road between the AIIB and Latin America
The past few months, we’ve been following the trail of the AIIB –Asian Infrastructure Investment Bank–. Not only because of its involvement with Latin American countries such as Peru and Venezuela, which are on the AIIB list of prospective members, but because it appears to be building itself as the other big multilateral bank –along with the World Bank and the Asian Development Bank–. Due to the increasing importance of the AIIB in Asian development, we approached their Head of Communication and Development, Laurel Ostfield, to have a better understanding of the Bank’s plans.
So far, due to the size of the organization, the AIIB considers itself a startup. However, there’s much to be said about its future. The bank already has 13 approved projects: one in India, Azerbaijan, Myanmar and Tajikistan, two in Bangladesh, Oman and Pakistan, and three in Indonesia. There’s also a long list of proposed projects in countries such as Georgia, Sri Lanka, the Philippines and Kazakhstan. These projects include investments in transport, energy, infrastructure and some are even multisectoral.
Although said bank has a wide choice of focus areas, according to Ostfield, they have three priorities: stable infrastructure –which includes concerns such as improving energy efficiency, agricultural development and water supply–, private capital mobilization, and cross-country connectivity. At the moment, all of them are tightly applied inside Asian territory. However, connectivity –if it fits the goals of the AIIB– has the chance to involve countries beyond Asia.
Despite the inclusion of Perú and Venezuela in the list of prospective members, there’s still a long way for the AIIB to tighten its relationship with Latin America. Their door is open but, evidently, it has to go hand in hand with the AIIB’s goals. So far, as Ostfield told us, their plans involve following the three priorities –infrastructure, capital and connectivity–, strengthen their team and build their internal capabilities and capacities.
In terms of seeing themselves as globalization agents, Ostfield was adamant to define the AIIB as such: “The bank is a multilateral organization. Is about shared value, shared benefits. Be either in or between countries. Globalization is about trade and that’s not really about us.”
As a startup, AIIB has clear internal and external plans. There’s no room for speculation or unnecessary competition. While some analysts have thought about possible differences between the AIIB, the World Bank and the ADB, Ostfield made it clear that they want to share knowledge with other financial institutions as well as deal with the development of Asia as a team. After analyzing their members, their plans and current projects, we have high expectations of the AIIB. It will be interesting to see how and when more relations with Latin America are developed.
LatinAmerican Post | Juan Sebastián Torres
