Will Japan Cooperate With China's Infrastructure Bank?

By Mina Pollmann

March 27, 2015

http://thediplomat.com/2015/03/will-japan-cooperate-with-chinas-infrastructure-bank/

As countries line up to join China’s AIIB, Japan has a decision to make. 

On October 24, 2014, 21 Asian nations signed on to establish the Asian Infrastructure Investment Bank (AIIB). The bank is led and – for now at least – primarily funded by China, and is intended to provide loans for building infrastructure (from roads to mobile phone towers) in under-developed parts of Asia.

For a long time, observers expected AIIB to be a competitor to the Asian Development Bank (ADB), the more established bank primarily backed by the U.S. and Japan. The banks would not “compete” in economic terms, as neither of them alone or even working together could finance all of Asia’s infrastructure needs, but there is a sense that the AIIB’s lower standards could undercut local goals that ADB’s more stringent conditions promote. However, on Wednesday, ADB President Takehiko Nakao said that ADB is willing to co-finance projects with AIIB if the latter meets the former’s standards for loans.