In January 2016, the Asian Infrastructure Investment Bank (AIIB) became operational in Peking. For the first time, China heads a multilateral bank, in which Western countries such as Germany are also involved. These give the Peking-dominated AIIB international credibility, and also in capital markets. The AIIB stands for China’s growing influence on the global financing of large infrastructure projects. It creates new competition for established finance institutions, especially for the World Bank, dominated by the US.

In the course of the AIIB founding, environmental and human rights groups warned that funded projects’ protection standards could turn out to be too weak. Formulating these environmental and social standards therefore needs to be independently and systematically monitored by civil society. Non-sustainable environmental and socially irresponsible projects must be traced and strategies found for a socially balanced and environmentally sustainable development.

We should also keep Western industrial societies’ responsibility in mind. In January 2019, Germany decided on a closer financial cooperation with China, which included investments within the New Silk Road Initiative and large infrastructure measures. Aim is a better coordination of German and European initiatives with those of China. In this context, Germany promotes China’s admittance as a new state lender to the Paris Club. Civil society must however, also critically accompany these development financings.

AIIB-Zentrale, Peking
Foto: AIIB
AIIB bureau

Money for the Silk Road

China's Belt and Road Initiative requires billions of dollars in investment. Numerous players are involved in financing the individual projects, one of which is the Asian Infrastructure Investment Bank. This bank, which is largely controlled by China, is still a relatively small player, but its influence is growing steadily.

https://urgewald.org/geld-fuer-seidenstrasse
Power plant under construction

Case studies: How environmentally friendly and socially just is the AIIB?

Together with European, American and Asian NGOs, urgewald documents the realities of the development projects financed by the AIIB. This work aims to give voice to local communities and testify that standards on paper can never be enough.

https://urgewald.org/en/aiib-watch
Tamakoshi River

Early-warning case study

The Tamakoshi V Hydroelectric Project is a stand-alone AIIB project which came into the proposed project pipeline in 2018.The project has strong impact on the environment and livelihoods. It’s a run-of-river hydro generation project on around 100 MW installed capacity. This project for the first time offered us the opportunity to implement an early-warning-system approach. The plan was to monitor from the very start the implementation of the different environmental and social standards as well as the consultation with local communities.

https://www.urgewald.org/sites/default/files/media-files/urgewald_Tamakoshi_Pap…

Environmental and social standards of the AIIB: room for improvement

In May 2021, the AIIB approved its revised environmental and social standards. The result: good, but not good enough. Our comment:

Menschenkette um den Globus
Korinna Horta

Germany’s responsibility in the AIIB

Interview with our AIIB expert Korinna Horta, who talks about her experiences with the new mega-bank AIIB. Germany’s membership has made the bank internationally presentable.

https://urgewald.org/geld-darf-menschenrechten-schaden
Chinese Flag

Taking Stock: the AIIB one year after its establishment

In its first year, the AIIB approved projects worth $1.7 billion. urgewald and partner organizations have already identified numerous points of criticism of the bank's work: weak protection standards for project-affected people and the environment, difficult public participation, inadequate monitoring. What can NGOs do? How do German politicians see their influence? Our expert conference explored these questions.

https://urgewald.org/taking-stock-aiib-jahr-ihrer-gruendung

Most important facts about the AIIB bank

  • Commencement of business: January 2016

  • Biggest shareholders:

  1. China
  2. India
  3. Russia
  4. Germany
  • Startup capital: 100 billion US $
  • Germany participation: 4,2 % share of votes, almost 4,5 billion US $
  • Projects primarily in Southern and Central Asia, Caucasus, European outlying areas
  • Sectors where the AIIB currently invests:
  1. Energy (3,8 billion US $)
  2. Transport sector (3,4 billion $)
  3. Water and irrigation (1,8 billion $)
  4. Infrastructure (1,2 billion $)
  5. Telecommunications (240 million $)
  6. Cross-sectoral (150 million $)
  7. Sanitation (115 million $)

(Source: Coalition for Human Rights in Development, June 2018)

AIIB building
Photo: AIIB