Britain joined a new Chinese bank and the US is really annoyed

Britain makes its own foreign policy decision (for once)

The US has criticised the UK for becoming a member of a new Chinese bank (i.e. the UK thinking for itself for a change).

The Asian Infrastructure Investment Bank (AIIB), which will fund Asian transport, energy and infrastructure projects, is a new financial institution that was set up in October.

Britain became the first Western nation to back the AIIB with an aim to forge closer relations with China and other Eastern economies.

However, the US has voiced concern the new Chinese bank will weaken the control the US has over the global banking system.

US National Security Council spokesman Patrick Ventrell said the US was concerned the AIIB will not meet standards and regulations.

“We believe any new multilateral institution should incorporate the high standards of the World Bank and the regional development banks.

“Based on many discussions, we have concerns about whether the AIIB will meet these high standards, particularly related to governance, and environmental and social safeguards.”

On Thursday, the Financial Times reported that an unnamed senior US official said the UK had taken the decision to join with “virtually no consultation with the US”.

However, the UK, one of 21 nations that are founding members the bank, denied that was the case. The Treasury said “at least a month of extensive consultation” took place among the G7.

The chancellor said it was important the UK was part of the new bank in order to help transparency.

In a statement, George Osborne said: “I am delighted to announce today that the UK will be the first major Western country to become a prospective founder member of the Asian Infrastructure Investment Bank, which has already received significant support in the region.

“This government has actively promoted closer political and economic engagement with the Asia-Pacific region and forging links between the UK and Asian economies to give our companies the best opportunity to work and invest in the world’s fastest growing markets is a key part of our long term economic plan.

“Joining the AIIB at the founding stage will create an unrivalled opportunity for the UK and Asia to invest and grow together.”

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Readers' comments (1)

  • we need to develop closer links with emerging countries and this seems a great opportunity to work with the world's largest and most developing economy-and let's do what suits UK, not what suits USA!

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