Swelling AIIB membership set to add to Beijing's international influence

About 25 African, European and South American countries are set to join the China-led Asian Infrastructure Investment Bank (AIIB) its President Jin  Liqun said on Monday, in another indication that President Donald Trump’s decision to pull the US out of the Trans-Pacific Partnership (TPP) could help reinforce China’s dominance in  the field of international trade and development. Ireland, Canada, Ethiopia and Sudan are understood to be on the list of potential new members, with several of them  likely to be inducted at the bank’s annual meeting in June. The AIIB was established last year with 57 founding shareholders and capital of $100bn.
“Now that China has developed, it is our turn to contribute,” Mr Jin said of the bank’s official raison d’être. “China needs to do something that can help it be recognised as a responsible leader.”
News of the bank’s imminent expansion comes days after  China’s  President Xi Jinping delivered  a strong apologia for globalisation to the World Economic Forum in Davos, warning of the dangers of protectionism and urging countries not to pursue narrow interests at the expense of others.  As well as providing him with another timely riposte to Trump’s threats to stem the volume of Chinese imports  the new US president claims are  flooding the  American market, Xi will probably have been particularly heartened by the news that the AIIB’s African membership is to grow.
While  China’s economic slowdown and its shift away from heavy industry has tempered its reliance on imports of natural resources from Africa (particularly oil and iron ore), traffic going the other way is on the rise – and both Chinese manufacturers and Africa’s  energy and mining industries can only benefit from the improvements to transport infrastructure that the AIIB can help finance.
Chinese money and know-how have already been used to build a rail link between the Ethiopian capital of Addis Ababa to the Red Sea port of Djibouti. The new line, which was 70% financed by China’s Exim Bank, built by the China Railway Group and China Civil Engineering Construction and manned by Chinese service and technical staff, has cut the journey time for freight traffic being transported to and from the coast from three days to  around 12 hours. 
Although Ethiopia’s membership has yet to be confirmed, the intention is most certainly there, according to Arkebe Oqubay, Minister and Special Advisor to Ethiopia’s  Prime Minister Hailemariam Desalegn. “Being a member of the club would help us access new financial resources,” he told the Financial Times,  adding that Ethiopia spent 60% of its federal budget on infrastructure. “We are looking for alternative financing and this could be a good opportunity for us.”
As AIIB membership expands, China’s voting share in key decisions will, ironically, be diluted down from its current level of 26%; but Beijing is understood to be willing to relinquish its veto as a price worth pay for the expansion of the bank’s footprint.

Source: FT