Russian President Vladimir Putin has dreamed of setting up a new financial order which would depose the US dollar as the international currency. His Chinese counterpart Xi Jinping might be making the dream come true. In the United States, the sudden European rally around China’s Asian Infrastructure Investment Bank (AIIB) has been nothing short of a clap of thunder in the criticized foreign policy of US President Barack Obama. What could be worse indeed than the “British brothers” who joined the AIIB in a surprise move that almost amounted to “treason” according to some US officials. The AIIB was proposed in October 2013 by the Chinese government as an alternate funding source for infrastructure projects in Asia.
From both sides, Chinese as American, the AIIB is seen as the quickly-emerging rival for the US-dominated IMF, World Bank and Asian Development Bank (ADB). Following the UK’s decision, three other European nations and major US allies – Germany, France, Italy – joined the AIIB too, confirming that the US government has been taken completely off guard. The White House worried that the AIIB might not meet “the high standards of the World Bank and the regional development banks,” while other allies like Australia, ROK and even Taiwan could be joining the AIIB soon. By developing its own system, China is directly attacking the US financial leadership and has so far succeeded in doing so.