The Asian Infrastructure Investment Bank (AIIB) has initiated an eight-week public consultation for the first draft of its Policy on Public Information, welcoming the public to participate in the multilateral development bank’s policy-making process. In light of this ongoing public consultation, I spoke with Dr. Kate Weaver, who visited Beijing last October for an AIIB legal conference regarding information disclosure and transparency policies.
Dr. Weaver expressed that she was pleasantly surprised with her first visit to the capital city. Since she was in Beijing during the 19th National Congress of the Communist Party of China, the factories had been shut off two weeks before to clean the air and the traffic was controlled. As she put it, “the air was bad, but not too bad.”
She described the AIIB’s hospitality as amazing. She was shocked to learn that the multilateral development bank only has a 100 person staff and was impressed that such a small staff got this major institution off the ground with such a streamline structure. Overall, Dr. Weaver left with a positive experience, glad that the AIIB held such an open discussion at a formative stage of the international organization.
You traveled to Beijing in the beginning of October. What was the purpose of that trip?
The Asian Infrastructure Investment Bank (AIIB) invited me to participate in their invitation only inaugural legal conference to be the expert on information disclosure and transparency policies. My particular panel discussed information disclosure, whistleblower policies, and similar policies within other multilateral development banks (MDB). We discussed what these policies should look like at the AIIB since the bank is still formulating an information disclosure policy.
Most of the participants at the conference came from legal counsels of other international organizations, some were former executive directors, and many work specifically on the governance issues of MDB. I think there were only two other academics there besides myself, so I was a little bit of an outlier there, but this also gave me the liberty to speak about the broader politics in a way that lawyers would be reluctant to do.
What were your main policy recommendations to the AIIB?
That they move quickly. They’ve existed for two years and don’t have an information disclosure policy in place, and they don’t have an archive policy that’s fully functional. It is critical for an institution in its infancy to have these mechanisms in order to distribute information about what it is doing. Primarily because people are going to make, more or less, educated guesses unless they are supplied with direct information. I’ve seen a lot of speculation about what the AIIB is doing, why it is doing it, and who's behind it, mainly concerning China’s motives with the bank. I recommend that they get in front of this by being as open as possible about their activities.
This requires an information disclosure policy with a presumption of openness, meaning they will release everything unless its on a list of excluded sensitive topics that would disrupt its relationship with clients. This is a policy that’s been adopted by other MDBs since 2009, when the World Bank adopted it. Now it's become a benchmark of being a modern, legitimate international organization. So to get ahead of misinformation and to acquire legitimacy in its new role, the AIIB needs to have proactive aggressive information disclosure.
The timing of this legal conference was notable since it coincided with the 19th National Congress of the Communist Party of China. Did this influence the discussions?
The AIIB president Jin Liqun actually came straight from those meetings. He was eager to demonstrate that the AIIB is a Chinese-led institution, not Chinese-driven institution, even though the AIIB is located in Beijing, the president is Chinese, and China is a majority shareholder with approximately 27 percent of the votes. This was special given the context and the timing of the conference. China has made a concerted effort to ensure that the AIIB is a more autonomous agency. I think in a part to distance itself from the tarnished reputation that Bretton woods institutions got by being U.S.-driven.
What was the most surprising thing you learned at the conference?
The AIIB’s emulation of other MDBs. The AIIB focus on infrastructure is innovative, and it is certainly innovative in its governance as the majority of the shareholders are from the Asia region. In all other aspects though, it looks like any Western led institution. This verified that this is not an example of contested multilateralism. The AIIB is not meant to replace or challenge existing models of MDBs, it's actually meant to be much more complimentary.
What are you expecting the AIIB to do in 2018?
They are going to have to get their governance rules solidified. Since they have more members than originally anticipated, they are going to have to deal with 80 members and representation on the executive board. They are also going to have to hit the road in terms of lending. To date, they only have 21 projects that are funded. There will need to be a concerted effort to get more projects out the door with key partnerships with the World Bank and the ADB. Finally, there will be a lot of speculation about whether the AIIB is just the idea of Chinese President Xi Jinping and whether or not the AIIB will last past that regime.