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Can the Asian Infrastructure Investment Bank limit South China Sea pressure?

By Stewart Taggart - posted Thursday, 16 June 2016

Can the Asian Infrastructure Investment Bank’s (AIIB) voting structure moderate Chinese territorial assertiveness in theSouth China Sea?  It’s an intriguing  idea. 

AIIB Voting Structure:South China Sea Pressure Point For China? 


 China holds veto power over Asian Infrastructure Investment Bank (AIIB) decisions but other countries joining together can challenge it on issues like the South China Sea.

AIIB votes require a 76% majority. China holds 25% of the votes. 

Despite this Chinese ‘veto,’ the AIIB’s other shareholders can make a very strong statement. 

The reason: the AIIB’s professed independence from Chinese Communist Party control would be severely questioned if China overruled other AIIB  members.  

China won’t want that.On the other hand: the South China Sea is the ‘Elephant in the Room’ with the AIIB.


Given China’s increasing political isolation regarding its Nine-Dotted Line claim to the entire South China Sea, China could use a politicalescape hatch.

Suitably united, the AIIB’s other countries can provide it.

The escape hatch would be for the AIIB to fund infrastructure that can be used to service Joint Development Areas in the South China Sea. 

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About the Author

Stewart Taggart is principal of Grenatec, a non-profit research organizing studying the viability of a Pan-Asian Energy Infrastructure. A former journalist, he is co-founder of the DESERTEC Foundation, which advocates a similar network to bring North African solar energy to Europe.

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