After the World Bank and the Asian Development Bank, the Asian Infrastructure Investment Bank (AIIB) now also held its annual meeting on October 26th – 27th, 2022. According to Natalie Lichtenstein, former advisor to the President of the AIIB, the bank’s accountability and environmental and social standards frameworks are modelled on the frameworks of the established development banks, and this was also confirmed by the scientific service of the German parliament.[1]
Urgewald has long warned not to be blinded by such statements. Europeans can – and must – make a difference: Germany is the fourth largest shareholder after China, India and Russia. Europe, with two voting groups, holds almost the same voting power as China. Here we have outlined how far even the revised environmental and social standards, the appeals mechanism and the transparency rules at hand, as well as the governance model of the AIIB differ from those of the World Bank.
The Bank's practice also differs fundamentally from other large development banks in the way it engages with civil society. Since the bank's foundation, Urgewald has been involved in critically monitoring the revision of environmental and social standards, the corporate strategy, the energy strategy and the framework for the appeals mechanism and has, together with other NGOs, pushed for improvements continuously.
Expectations were high towards the AIIB and all its promises – yet as early as 2020, local groups sounded the alarm that the bank keeps coming up short.
This year's AIIB Annual Meeting was held under the motto: "Sustainable infrastructure towards a connected world." This brings the bank a little closer to China's Silk Road strategy. According to its president Jin Liqun, other banks are responsible for poverty reduction, while the AIIB focuses on energy, roads, urban development and telecommunications – "a rising tide lifts all the boats" (Jin Liqun 2018). The AIIB is a multilateral bank, initiated by China. At the same time, however, together with the Silk Road Fund and China's major state banks, it serves to finance costly infrastructure projects in the energy and transport sectors under the helm of the Belt and Road Initiative (BRI).
It is particularly devious that this year Mongolia held the chairmanship of the annual meeting. Mongolia is not only an important transit country for the gas pipelines planned between Russia and China: Gazprom signed a contract in early summer for the planning of the Soyuz-Vostok pipeline through Mongolia to China. The statement said that this new pipeline will be "a continuation of the Russian Power of Siberia 2 gas pipeline." Mongolia is also one of the countries currently in a critical debt situation as a result of Chinese lending. The Sukgherel Dugersuren case has also shown how quickly accusations of sabotage and threats of imprisonment stifle environmental activism.
"Our partner organizations have tried to open up constructive dialogue on behalf of the affected local communities with numerous letters, submissions and statements. After seven years, more insight and commitment are needed from European shareholders," said Dr. Nora Sausmikat, Head of China Desk at Urgewald. "The standard responses that the bank is still young, and that it is unfortunately not possible to address the specific fossil fuel needs of the regional shareholders, or that the AIIB is an investment bank and not a development bank and therefore has no country strategies regarding climate protection targets, are scandalous."
The AIIB's development model follows a Chinese understanding that development is primarily "a process of technology-centered modernization." The needs of the states, i.e., the clients, rather than those of the people are in focus here; here the bank follows the Chinese principle of "unconditional investment." It is therefore not surprising that the environmental and social standards are weakly formulated and hardly implemented.
We demand: The democratically elected governments of AIIB shareholders must aggressively uphold a values-driven foreign policy, which is also committed to climate protection. In the same vein, they must defend and expand the unrestricted dialogue with civil society. Seven years on, it is high time!
---
[1] Wissenschaftliche Dienste, Deutscher Bundestag, Sachstand, Die Sozial-und Menschenrechtsstandards der Weltbank und der Asiatischen Infrastruktur-Investment Bank, WD 2-3000-091/16.
