AIIB committed to the development of infrastructure in Asia
Tuesday,Jun 11, 2019
On June 11th, the Center for China and Globalization (CCG) was pleased to welcome Sir Danny Alexander, Vice President and Corporate Secretary at the Asian Infrastructure Investment Bank (AIIB), to deliver a speech on the development and future prospects of the organization. As a part of CCG’s Distinguished Speakers’ Series, this event gathered together an audience of experts, academics, business leaders and CCG researchers, as well as media representatives, to explore and discuss how AIIB has progressed since its founding, and what the future holds for the development bank.
Introducing the speaker, CCG President, Dr. Wang Huiyao detailed Sir Danny Alexander’s illustrious career, spanning UK Senior Treasury department positions in the UK Coalition Government and his time spent as a Member of Parliament, after which he joined AIIB shortly following its establishment in 2015. Dr. Wang went on to highlight the importance of AIIB as a multilateral institution initiated by China, now having developed into a truly global institution with member countries from all over the world.
Sir Danny Alexander began his speech by noting that as the only multilateral development bank yet to be founded in the 21st century, AIIB is a developing, young institution that adheres to the highest international standards. He elaborated on the core values held by the bank, explaining AIIB’s commitment to being “lean, clean and green”. These values guide the AIIB as an organization and impact all aspects of its work. Lean refers to the bank’s commitment to limiting bureaucracy and handling funds efficiently. Clean is in reference to AIIB’s practice of good governance, maintaining high standards with clear reporting and accountability mechanisms. Green is representative of the bank’s pledge to promote sustainable development and green investment, with all AIIB member countries signatories of the Paris Agreement.
AIIB boasted 57 founding member nations in 2015, and now, three years later, the organization has 97 member countries in total hailing from all continents of world, with Asian nations in the majority. To date, Sir Alexander stated, AIIB has invested over $8bn into 40 projects across 16 countries, India being the largest recipient of investment. As a multilateral development bank, AIIB is committed to improving local infrastructure capacity and pursuing high-quality projects, actively developing multilateral dialogue, promoting the mutual interests and shared responsibility of member countries, he said.
Whilst this is a modest start for the bank, the AIIB Vice President emphasized the necessity for each project to meet the bank’s high standards and reiterated that it has secured funds for future projects. The need for infrastructure investment in Asia remains huge, with estimates reaching over $1.7tn. To meet this need and bridge the gap between demand and required funding, Sir Danny Alexander said AIIB seeks to mobilize private funds, something which it has had success with in the past.
The work of the bank is separated into three strands, namely: sustainable infrastructure, connectivity, and mobility of private capital. A big advantage of being a multilateral institution is that it allows the bank to plan for the long term, aware but unaffected by short term challenges. This is exemplified, said Sir Alexander, by the recent grant given to Nepal by AIIB in order to bring projects up to a level where they can be invested in by the bank. Another project referenced by the AIIB Vice President is a broadband infrastructure project conducted in Oman, a middle-income nation, which spread internet use to hundreds of thousands of residents.
Following his speech, Sir Danny Alexander responded to questions from guests and the media on issues such as the impact of the trade war on infrastructure investment, management of AIIB’s international workforce and the development prospects of 5G technology in infrastructure. On the impact of the trade war on AIIB projects, Sir Danny Alexander admitted that the Sino-US trade war will inevitably lead to a downturn in the infrastructure market. In addition, restrictions on private investment due to geopolitical tensions have contributed to the downturn in infrastructure investment, however, this has had a limited impact on AIIB due to its long-term outlook.
In response to the management of AIIB’s global and diverse staff, the AIIB Vice President stressed that AIIB does not favor any particular country and, mirroring the bank’s approach to investment projects, hires staff solely based upon merit. At present, the Beijing headquarters of the organization has 230 employees from 44 countries, and its five vice presidents all hail from different countries.
Regarding the role of 5G in future AIIB projects, Sir Danny Alexander said the broadband investment project in Oman represents the potential for AIIB to conduct more projects in the areas of communications and network infrastructure. Not only should AIIB seek to invest in 5G infrastructure projects but also look to utilize the technology to improve the implementation of other infrastructure projects.
Participants in attendance for this event included Maria Ahmed, AIIB Senior Secretariat Officer, Jia Wenshan, Distinguished Professor at the Renmin University of China School of Journalism and Communications and CCG Senior Non-Resident Fellow, Alvin Wong, First Secretary of the Singapore Embassy in Beijing, Shao Tian, Deputy Chief Editor of the Economist Global Business Review, Tang Haoxuan, Chairman of Fueta International and CCG Senior Council Member, Andy Mok, CCG Research Fellow, CGTN Commentator, and representatives from over 20 media outlets.
Sir Danny Alexander
Vice President and Corporate Secretary, AIIB
The Right Honorable Sir Danny Alexander is Vice President and Corporate Secretary of the Asian Infrastructure Investment Bank (AIIB) .
He joined the AIIB in February 2016, two months after the Bank was inaugurated. He is a member of the senior management team, with responsibility for governance and the Bank’s relations with its shareholders, Board of Governors, and Board of Directors.
Prior to this Sir Danny Alexander was one of the founders and leaders of the first UK coalition government since World War II. Sir Danny has over 20 years of professional experience. From 2010-2015 he served as a senior minister in the UK Treasury, where he secured more than £100 billion of public expenditure savings. He has played an active role in driving international cooperation on tax, trade and transparency during the UK G8 presidency. A seasoned negotiator and communicator, Sir Danny has engaged with diverse stakeholders and partners on key public policies. He led the work on UK infrastructure policy and delivery, leading to the first National Infrastructure Plan, which is now embedded as an annual process. He helped to establish the Green Investment Bank in the UK and to develop and implement the UK Guarantee Scheme for infrastructure.
Sir Danny is a Visiting Fellow at Nuffield College, Oxford University, and an Honorary Fellow at St Anne’s College, Oxford. He has a BA in Philosophy, Politics, and Economics from Oxford University.