China's rise confounds a splintered west
British opportunism met with US fumbling and discussion was technical, not strategic.
No country was seen to be as supportive of the US position as Japan — in part because many officials in both countries saw the AIIB as a direct challenge to the Japanese-controlled Asian Development Bank.
But Japanese executives look on China's ambitious plans to help build infrastructure in the region as a huge business opportunity, as well as a chance to help repair frayed relations.
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This month, for example, a group of Mitsubishi Group executives based in China met Jin Liqun, who will run the infrastructure bank, to offer their support. Mr Jin, once a senior official at the ADB, is a familiar face to many Japanese. They say they have confidence, in part because of his participation, that the bank will adhere to best practice.
Neither the ADB nor other multilateral financial institutions have anything like the resources necessary to finance Asia's infrastructure needs. And beyond Japan, the region lacks private sector institutions such as insurers with deep enough pockets to fund such large, long-term projects, while new capital requirements discourage banks from doing so.
The AIIB, as well as the New Development Bank (better known as the "Brics bank") and the "one belt, one road" initiative, is also seen as a way for China to deal with its huge excess capacity in industries ranging from cement and glass to iron and steel.
One former US official at Boao said that if the Japanese joined the AIIB, Washington would be forced to soften its stance and might choose to adopt observer status.
So far, US officials have said they merely want to ensure the bank adopts best practice and transparency in its lending.
Some officials in India, for example, privately say that they fear the projects will cause deepening problems for them as China attempts to export its deflation. But such voices are a minority in Asia.