Asian Infrastructure Investment Bank (AIIB)

The Asian Infrastructure Investment Bank (AIIB) was initiated by China and launched in 2016. With a mantra to be “lean, clean and green”, it currently has four thematic priorities: green infrastructure, connectivity and regional cooperation, technology-enabled infrastructure and private capital mobilisation.

The AIIB’s membership is growing. By mid-2024, the AIIB had 109 members worldwide, which sit on the Board in 11 mixed shareholder country constituencies alongside China as one shareholder.

China holds over a quarter of the votes. Russia and India are the second and third largest shareholders, followed by Germany fourth. European shareholders are particularly significant, all together representing almost a quarter of the votes, second only to China. The US and Japan, who jointly dominate shareholder power at the Asian Development Bank (ADB), have not joined the AIIB.

The AIIB’s first projects were in the Asia region, including Central Asia, but already at the end of its first year, the bank started financing projects in the Middle East and Northern Africa. It has since expanded to South America from 2020 and Sub-Saharan Africa from 2021, and shifted away from projects funded with other multilateral development banks (MDBs) to independent lending.

When its accountability mechanism, the Project-affected Peoples Mechanism (PPM), was created in 2019 it fell short of best practice. The AIIB is unique among MDBs in ruling the majority of co-financed projects ineligible for the PPM, and to date has not accepted a single complaint, despite a portfolio of almost $55 billion.

Recourse’s work on the Asian Infrastructure Investment Bank

Recourse has monitored the AIIB since the very beginning, trying to ensure the world’s newest MDB meets and does not undermine global environmental and social standards. Our work focuses on issues such as accountability, gender and climate change, with particular attention to the AIIB’s lending through financial intermediaries.

Working with partners, we engage in advocacy and campaigning to influence policies and strategies, such as the AIIB’s Energy Sector Strategy.
In Europe, we lead on civil society coordination towards the AIIB’s Wider Europe shareholder constituency.
We campaign to ensure the AIIB enhances accountability both in its policy and practices – so that affected communities have recourse to remedy through the PPM should they suffer harms, and so that the AIIB can learn lessons from its mistakes and not repeat them.
We have successfully pushed the AIIB to develop a Climate Change Action Plan and disclose its Paris Agreement methodology, while working with partners to continue expose loopholes for fossil fuel investments, including putting the spotlight on problematic projects.
Recourse challenges the AIIB’s approach to climate finance, especially its disregard for gender equality and lack of rigorous standards against fossil fuels.
Using our expertise on financial intermediaries lending, Recourse has successfully pushed the AIIB to improve its standards governing this ‘hands-off’ form of lending. Investing in third parties such as private equity funds, or commercial banks, brings with it higher risks, which Recourse has exposed in a series of case studies, from India to Myanmar.
Recourse is also monitoring the AIIB’s use of risky new infrastructure finance models called InVITs, including in India.
Every year, we collaborate with partners to bring our demands directly to the decision-makers at the AIIB’s Annual Meeting.