AIIB (Asian Infrastructure Investment Bank) news

[ahojunk]

The news for AIIB keeps on getting better. Just hope the World Bank is sincere, which I doubt.

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http://www.ft.com/cms/s/0/c58cbd66-dcee-11e4-975c-00144feab7de.html

World Bank chief endorses rival AIIB as ‘major new player’
April 7, 2015 2:30 pm

Jim Yong Kim has given his strongest endorsement yet of the AIIB

The World Bank’s US-appointed president has vowed to find “innovative” ways to work with a new Chinese-led Asian infrastructure bank, welcoming it as a “major new player” in the world of development.

The overture by Jim Yong Kim comes ahead of next week’s World Bank and International Monetary Fund spring meetings in Washington. It also marks a split with the administration of US President Barack Obama which nominated the medical doctor and former university president to head the World Bank in 2012.

With geopolitical imperatives and its competition with China for influence in the Pacific Rim firmly in mind the US unsuccessfully lobbied allies such as Australia, Japan and the UK not to join the nascent Asian Infrastructure Investment Bank.

Behind that push by Washington has also been a desire to protect the Bretton Woods institutions over which the US and Europe now wield veto power. So the move by one of those institutions’ heads to break from the US and set out a vision for co-operation with the new institution marks another blow to Washington’s diplomatic efforts.

Dr Kim has said he was willing to work with the AIIB before. But in a speech on Tuesday in Washington he went further, offering his strongest endorsement yet of the AIIB and putting it high on the agenda for next week’s meetings.

Calling the AIIB and its fellow start-up, the Brics-backed New Development Bank, “potentially strong allies” for the World Bank that could become “great new forces” to help the world’s poor, he pledged to quickly find ways to collaborate with the new institutions.

“If the world’s multilateral banks, including the new ones, can form alliances, work together, and support development . . . we all benefit — especially the poor and most vulnerable,” he said. “I will do everything in my power to find innovative ways to work with these banks.”

One of those potentially innovative ways would be encouraging the AIIB to help finance projects run by the World Bank and subject to its environmental, labour and social standards, Dr Kim said ahead of the speech.

Such a move would help address one of the biggest fears expressed by the US as well as environmental and other advocacy groups over the AIIB. Washington argues that with big questions still lingering over its governance structures there is a risk that the AIIB’s eventual forays into developing countries will look much like China’s sometimes destructive and protest-inducing pushes into Africa and developing countries in Asia such as Myanmar in the recent past.

Dr Kim is due to meet Lou Jiwei, the Chinese finance minister, during next week’s meetings in Washington and he said he was looking forward to a “long session” with Mr Lou to discuss the future of the AIIB and its collaboration with the World Bank.

To generate economic growth and meet the needs of rising populations the developing world needs an additional $1tn-1.5tn each year to be invested in bridges, roads, railways and other infrastructure, Dr Kim said.

The world’s existing development banks combined lacked the resources to meet those needs, he said. To succeed, he said, more funding for development projects needed to come from the private sector and new entrants such as the AIIB, which so far has a capital base of less than $100bn.

“These goals are ambitious — there’s more than enough work to go around,” Dr Kim said. “We’re no longer talking about billions of dollars for economic development. We’re talking about trillions of dollars — which means that we must be creative and use all of our resources.”
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[Jlaw]

The news for AIIB keeps on getting better. Just hope the World Bank is sincere, which I doubt.

---------------------
http://www.ft.com/cms/s/0/c58cbd66-dcee-11e4-975c-00144feab7de.html

World Bank chief endorses rival AIIB as ‘major new player’
April 7, 2015 2:30 pm

Jim Yong Kim has given his strongest endorsement yet of the AIIB

The World Bank’s US-appointed president has vowed to find “innovative” ways to work with a new Chinese-led Asian infrastructure bank, welcoming it as a “major new player” in the world of development.

The overture by Jim Yong Kim comes ahead of next week’s World Bank and International Monetary Fund spring meetings in Washington. It also marks a split with the administration of US President Barack Obama which nominated the medical doctor and former university president to head the World Bank in 2012.

With geopolitical imperatives and its competition with China for influence in the Pacific Rim firmly in mind the US unsuccessfully lobbied allies such as Australia, Japan and the UK not to join the nascent Asian Infrastructure Investment Bank.

Behind that push by Washington has also been a desire to protect the Bretton Woods institutions over which the US and Europe now wield veto power. So the move by one of those institutions’ heads to break from the US and set out a vision for co-operation with the new institution marks another blow to Washington’s diplomatic efforts.

Dr Kim has said he was willing to work with the AIIB before. But in a speech on Tuesday in Washington he went further, offering his strongest endorsement yet of the AIIB and putting it high on the agenda for next week’s meetings.

Calling the AIIB and its fellow start-up, the Brics-backed New Development Bank, “potentially strong allies” for the World Bank that could become “great new forces” to help the world’s poor, he pledged to quickly find ways to collaborate with the new institutions.

“If the world’s multilateral banks, including the new ones, can form alliances, work together, and support development . . . we all benefit — especially the poor and most vulnerable,” he said. “I will do everything in my power to find innovative ways to work with these banks.”

One of those potentially innovative ways would be encouraging the AIIB to help finance projects run by the World Bank and subject to its environmental, labour and social standards, Dr Kim said ahead of the speech.

Such a move would help address one of the biggest fears expressed by the US as well as environmental and other advocacy groups over the AIIB. Washington argues that with big questions still lingering over its governance structures there is a risk that the AIIB’s eventual forays into developing countries will look much like China’s sometimes destructive and protest-inducing pushes into Africa and developing countries in Asia such as Myanmar in the recent past.

Dr Kim is due to meet Lou Jiwei, the Chinese finance minister, during next week’s meetings in Washington and he said he was looking forward to a “long session” with Mr Lou to discuss the future of the AIIB and its collaboration with the World Bank.

To generate economic growth and meet the needs of rising populations the developing world needs an additional $1tn-1.5tn each year to be invested in bridges, roads, railways and other infrastructure, Dr Kim said.

The world’s existing development banks combined lacked the resources to meet those needs, he said. To succeed, he said, more funding for development projects needed to come from the private sector and new entrants such as the AIIB, which so far has a capital base of less than $100bn.

“These goals are ambitious — there’s more than enough work to go around,” Dr Kim said. “We’re no longer talking about billions of dollars for economic development. We’re talking about trillions of dollars — which means that we must be creative and use all of our resources.”
.

I don't want to sound like a crazy conspiracy guy, but it appear the S. Korea economy is under the control of foreigners since 1998 when they borrowed $33b to ease the burden of the Asian financial crisis

 

[ahojunk]

Poor Taiwan. The AIIB is still causing political turmoil in Taiwan.

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DPP to rethink joining the AIIB 'practically' - The China Post

DPP to rethink joining the AIIB 'practically'
By Katherine Wei, The China Post
April 7, 2015, 12:00 am TWN

As China is promoting its “One Belt, One Road (一帶一路)” initiative and establishing the Asian Infrastructure Investment Bank (AIIB), Taiwan is torn between filing to join the association and asking itself whether the Ma administration has been honest and straightforward about its financial plans.

While some in the pan-green camp were saying that the government was guilty of deciding it would join the AIIB before explaining to the people, the Democratic Progressive Party (DPP) also opined that it was necessary to discuss the implications of the initiative and the AIIB's goals.

Party members allegedly linked whatever aftermath the AIIB would bring with the upcoming presidential elections, and prompted the party's management to discuss the economic and diplomatic effects the AIIB would possibly bring about in a practical manner.

The term “One Belt, One Road” refers to the Silk Road Economic Belt and 21st-Century Maritime Silk Road initiatives raised by Chinese President Xi Jinping during his state visit to Indonesia in 2013.

The DPP's fellow pan-green party, the Taiwan Solidarity Union, has been boycotting parliamentary sessions seeking approval of the controversial flight route M503 and Taiwan's prospective joining of the AIIB in the Legislative Yuan over the past few weeks, yet the DPP was seen to be taking a different approach.

DPP caucus whip Ker Chien-ming (柯建銘) said yesterday that “We (Taiwan) should join the AIIB ... in the wake of China's plans for the Eurasia region, Asia's banks, international banks and international monetary funds will not be able to deal with the enormous demand for funds that the “One Belt, One Road” will bring. This is no longer an issue about benefits and disadvantages anymore,” said Ker.

Ker also cited China's declaration that it would be “making appropriate arrangements for Taiwan regarding its participation in the One Belt, One Road establishment,” and said Taiwan may join in the end as “Chinese Taipei.”

“It will never be 'Taipei, China.'” said Ker.

Beijing has previously stated that should Taiwan participate in China's AIIB plans, there would not be “two China's,” nor would there be “one China, one Taiwan.”

DPP Members Understanding on Ma's Hurried Decision

Ker and his DPP members were at odds regarding the Ma administration's decision to join the AIIB. The caucus whip pointed out that national security departments had already begun an evaluation of the AIIB, but the government was still waiting for the reaction of the U.S.

Ker questioned Ma's refusal to explain any difficulties to the people, indicating that the application to join AIIB was sent out in a hurried and secretive manner that was “too dramatic and similar to the rushed passage of the Cross-Strait Trade in Services Agreement last year.”

However, unnamed DPP members said yesterday that they “understood the government's handling of the AIIB incident this time, as some of the EU members are asking to join the AIIB as well, so Taiwan is only forced to follow them.”

The AIIB is slated to be launched by the end of this year, and the members to be confirmed allegedly around mid-2015.

 

[Kiss_of_the_Dragon]

..Iran got in as founding member (that was fast)

I'm wondering why we haven't announced Iran's intention to participate the AIIB in the beginning but only the result? there must be a rational explanation to this. Is there some secret geopolitical deal between China and Iran?

 

[terranMarine]

I'm wondering why we haven't announced Iran's intention to participate the AIIB in the beginning but only the result? there must be a rational explanation to this. Is there some secret geopolitical deal between China and Iran?

Same goes for Russia , boom out of no where these two have been approved while others are still pending.

Czech president, US envoy in rare public spat over Ukraine | Daily Mail Online

US ambassador barred from Prague Castle by Czech president - BBC News

US diplomat telling Czech president not to attend WW2 anniversary also failed

 

[Abii]

I'm wondering why we haven't announced Iran's intention to participate the AIIB in the beginning but only the result? there must be a rational explanation to this. Is there some secret geopolitical deal between China and Iran?

Iran's approval might have been pending on a deal with the P5+1.

Hopefully this means Iran can become a full member of the SCO now.

 

[ahojunk]

So far, Brazil is the only South American (Latin American) country that has applied to join the AIIB.
They have access to China's funds via other instruments.

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Brazil sole nation in LatAm to join AIIB - The Nation

Brazil sole nation in LatAm to join AIIB
April 7, 2015 4:03 pm

(China Daily) - More than 45 countries have signed up to be a part of the China-led Asian Infrastructure Investment Bank but Brazil is the only Latin American country that has committed to the bank.

Australia, France, the United Kingdom, Germany, India, Italy, and South Korea are among the nations that have said they will join the AIIB, which has received the blessing of International Monetary Fund chief Christine Lagarde. The new bank plans to invest $100 billion in infrastructure projects in Asian countries. China also has its "One Belt, One Road" strategy, an initiative to promote economic and cultural ties with countries involved.

Kevin Gallagher, an associate professor at the Frederick S. Pardee School of Global Studies at Boston University and co-director of the Global Economic Governance Initiative, said that Latin American nations in many ways have their own version of AIIB.

"Latin America already enjoys China as a member of the Inter-American Development Bank, China-CELAC (Community of Latin American and Caribbean States) which has set up approximately $35 billion in funds with Latin America, and of course China’s policy banks provide upwards of $119 billion in finance to the region," he said.
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[Al Bhatti]

April 7, 2015

UAE, Iran approved as founder members of China-backed infrastructure bank
More than 50 countries, plus Taiwan, have now applied to join the bank in a diplomatic coup for Beijing

Iran has been approved as a founding member of the Beijing-backed Asian Infrastructure Bank (AIIB), China’s finance ministry said Tuesday, just days after Tehran sealed a historic framework agreement on its nuclear programme.

Tehran’s application was backed by other founding members on Friday, China’s Ministry of Finance said in a statement on its website. The UAE’ bid was also approved.

More than 50 countries, plus Taiwan, have now applied to join the bank in a diplomatic coup for Beijing after Washington initially opposed its allies becoming members.

The United States and its Asian ally Japan have not sought to join.

But US Treasury Secretary Jacob Lew said last week that Washington was “ready to welcome” the bank, though he added it should complement existing multilateral institutions such as the World Bank and International Monetary Fund.

Iran’s approval — its application had not been previously announced — comes immediately after the nuclear deal that China helped to broker.

Under the outline nuclear deal, the United States and the European Union are to lift all nuclear-related sanctions on Iran once the UN atomic agency has verified that Tehran has stuck to its terms.

The proposed limits will see Iran’s stocks of highly enriched uranium cut by 98 per cent for 15 years, while its unfinished Arak reactor will not produce weapons-grade plutonium.

There are concerns over transparency of the AIIB, which will fund infrastructure in Asia, as well as Beijing using it to push its own geopolitical and economic interests as a rising power.

Under President Xi Jinping, China is pushing to build on the ancient Silk Road trade routes on land and sea, through its ‘One Belt, One Road’ initiative expected to be partly funded by the AIIB.

UAE, Iran approved as founder members of China-backed infrastructure bank | GulfNews.com

 

[cirr]

Malta and Kyrgyzstan have been approved as founding members of the AIIB today 09.04.2015.

 

[ahojunk]

Japan has missed the boat. Now it can join AIIB as an ordinary member, not a founding member.
Wouldn't it be interesting is US join too, but only as an ordinary member.

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Japan should join the AIIB | The Japan Times


Opinion

Japan should join the AIIB

Japan stood out — along with the United States — among the major economies in deciding not to join the planned new China-led regional investment bank as founding members. While the government cited concerns over governance standards and operational transparency of the planned institution when it opted to not sign up by the March 31 deadline, it is obvious that Japan had chosen to keep in step with the U.S., which views the Chinese initiative to establish the Asia Infrastructure Investment Bank (AIIB) as Beijing’s challenge to the post-World War II international financial order, even as roughly 50 countries — including key European powers and many U.S. allies — decided to join.

The concerns about the new bank’s governance may indeed be legitimate. But there is little that Japan can do to address the AIIB’s perceived problems if it remains a non-member. Japan should join the bank so it can exert influence from within to ensure that it is run according to international norms.

The planned new bank aims to fill the enormous demand for loans to finance infrastructure-building investments in the growing Asian markets, which are currently not being met by existing international financing institutions. China has said the AIIB will not compete with the World Bank or the Manila-based Asian Development Bank — which has historically been headed by officials from Japan, the largest contributor of the institution along with the U.S. — but rather complement their roles. The AIIB, which will initially be capitalized at $50 billion and later $100 billion, is to be headquartered in Beijing. China will be its largest contributor and a former Chinese finance bureaucrat is expected to be tapped as the institution’s first president.

Behind China’s plan to create the AIIB is no doubt its frustration with the international financial framework led by the advanced economies, which does not reflect the growing presence of emerging economies in its decision-making. Much of the wariness toward the initiative, meanwhile, derives from skepticism over what the world’s second-largest economy intends to do with the new bank.

Finance Minister Taro Aso said Japan had no choice but to take an “extremely cautious stance” toward joining the AIIB, citing unanswered questions about the bank’s governance standards and transparency on how it screens loans for approval. Among the concerns over the AIIB’s governance is apprehension that China might use the institution to expand its economic clout by playing a decisive role in its loan-approval process — unlike the ADB, whose board of representatives from participant nations wield strong power in loan decisions. It is feared that the AIIB could be run in discretionary ways to promote China’s own interests.

But can Japan, and the U.S. for that matter, do much to influence the making of operational rules at the new bank — which will be formally launched by the end of this year — if they remain outsiders? It hardly seems credible that they can retain leverage by withholding their participation now that roughly 50 countries have opted to become founding members. The participants include major European powers such as Britain, Germany, France and Italy, key U.S. allies in the Asia-Pacific region such as Australia and South Korea, all 10 members of the Association of Southeast Asian Nations, as well as India, Brazil and Russia.

The initial caution on the part of many of the advanced economies was dispelled when Britain announced its plan to join the AIIB in mid-March. The other European powers immediately followed its lead. Along with the attraction of economic ties with China, the participants from outside Asia were apparently drawn to the enormous potential of infrastructure investments in the region and the opportunities that they would bring for their businesses. In fact, concern is reportedly growing in Japan’s business circles — as well as within the ruling Liberal Democratic Party — that Japanese firms could face disadvantages in the competition for a slice of this lucrative market due to the nation staying out of the AIIB.

Despite the questions about the planned new institution, there is great demand for more funding for infrastructure investments in Asia. The ADB estimates that the region needs about $700 billion in such investments each year, but the ADB cover less than one-fiftieth of that amount. Investment needs for such projects as railway and road construction in the region are forecast to reach $8 trillion in the decade to 2020. Asian countries that have signed up for the AIIB expect the institution to provide them with more loans for their investment projects.

The countries that joined as founding members are aiming to agree on the rules of running the new bank and capital contribution by each member by the end of June. The Japanese government reportedly plans to consider whether to join by the time such details take shape.

When Japan decided not to sign up for the AIIB at the end of last month, Prime Minister Shinzo Abe is reported to have told LDP members at his office, “Now the U.S. will see that Japan is a reliable country.” The government appears to have placed priority on Japan keeping in step with the U.S. at a time when its other allies and major European powers have defied it and joined the China-led initiative.

Japan may have impressed the U.S. with its loyalty by staying out of the AIIB, but it remains to be seen whether it was the right decision for the world’s third-largest economy, which has gained a wealth of know-how and experience in regional financing through its activities in the ADB.
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[TaiShang]

New Kid on the Block: China Dealing Crushing Blow to US Supremacy in Asia
13:40 09.04.2015(updated 14:06 09.04.2015) Get short URL

China is determined to subvert American supremacy in Asia, said Richard Javad Heydarian, adding that Beijing has brought numerous regional and international players under its umbrella due to its efficient economic charm offensive.

China has thrown down the gauntlet to the established Bretton Woods' economic world order and American supremacy in Asia by launching new ambitious infrastructure projects in the region and dislodging the US from the South China Sea, noted Richard Javad Heydarian, an expert in international affairs and policy advisor in the Philippine House of Representatives.

"China's astute economic diplomacy—aimed at challenging the Bretton Woods system (BWS) of global governance—and accelerated construction activities in the South China Sea, an artery of global trade, are chipping away at the very foundations of the decades-long US-led order in Asia," Richard Javad Heydarian stressed.

The rapid development of the China-led Asian Infrastructure Investment Bank (AIIB), the New Development Bank and the New Silk Road initiatives has simultaneously marked the triumph of Beijing's soft power and Washington's dreadful fiasco.

© AP Photo/ Charles Dharapak

Et Tu, Brute? Israel Latest US Ally to Join Chinese AIIB

The expert elaborated, however, that "in fairness," Beijing's decision to challenge the established BWS was largely caused by emerging powers' growing frustration over the lack of much-anticipated reforms in the World Bank and the International Monetary Fund (IMF), blocked up by the US Congress in 2010.

Citing the volatilities of currency markets, China invests its vast financial reserves into Asian infrastructure projects. However, the expert noted that some international observers are inclined to consider particularly the AIIB a "Trojan horse for its broader strategic interests in Asia."

China uses its financial resources to "purchase" the loyalty of its Asian neighbors, Mr. Heydarian believes, citing prominent Chinese scholar Yan Xuetong.

"The policy now is to allow these smaller [neighboring Asian] countries to benefit economically from their relationships with China. For China, we need good relationships more urgently than we need economic development. We let them benefit economically, and in return we get good political relationships," Xan Xuetong pointed out.

© AFP 2015/ Takaki Yajima
Iran Joins China-Led Asian Infrastructure Investment Bank

While the US Asian allies, from the Philippines to Vietnam to Japan, are watching China's steady expansion in the region, it seems that the United States has nothing to bring to the table in order to swing the balance in its favor.
The US' vain attempts to boycott the AIIB have ultimately failed after the UK, Washington's closest (European) ally, announced it would participate in the China-led initiative, paving the way for other European and Asian partners of the US to join.

Washington has found itself in a rather embarrassing situation, isolated and left by all. The situation prompted US Treasury Secretary Jack Lew to state grudgingly that the United States "welcome China having a significant role in the global economic and financial architecture."

Washington's strategic primacy in Asia is at stake – it is clear that China is determined to change the established status quo in the region and obliterate America's longstanding supremacy, the expert underscored.


Read more: New Kid on the Block: China Dealing Crushing Blow to US Supremacy in Asia / Sputnik International

 

[ahojunk]

AIIB could rank among world’s top bodies - Global Times

AIIB could rank among world’s top bodies
Source:Global Times Published: 2015-4-6 21:53:01

Friis Arne Petersena Photo: Courtesy of the Royal Danish Embassy in Beijing

Editor's Note: The China-initiated Asian Infrastructure Investment Bank (AIIB) has seen a rush of applications for membership, before the deadline of March 31. Global Times (GT) reporter Wang Sining interviewed Danish Ambassador to China Friis Arne Petersen (Petersen) on Denmark's application filed to become a founding member of the AIIB and the role that the bank is expected to play in the future.


GT: Could you tell us why Denmark wants to join the AIIB as a founding member?

Petersen: Joining the AIIB is in line with the national interests of Denmark, and in accordance with Denmark's long-term global commitment and obligations.

On a yearly basis, Denmark gives away some $2.5 billion, or 0.84 percent of its GDP to development assistance programs around the world.

As a Nordic country, not only do we have an outbound assistance system, but we also have great economic and political interests in Asia.

During the past seven or eight years, Asia as a whole has been contributing positively to the world economy, against the backdrop of economic recession and downturn pressure in much of the rest of the world.

There is a positive influence on the economy from Asia, and it can be even bigger in the future.

The AIIB can provide the region with a great amount of new economic growth opportunities, and thus it is of great importance to Denmark.

GT: Which countries are Denmark's friends in Asia?

Petersen: We have very big bilateral trade and investment flows with many Asian countries, and that should continue and grow. It is of great interest to Denmark.

Denmark has also frequently cooperated with countries like China, Japan, South Korea, Thailand, Indonesia, India, Afghanistan, Pakistan, Myanmar, Malaysia and Vietnam.

There are really many new opportunities, and Danish assistance has been present for a long time.

GT: What kind of role will Denmark play after joining the AIIB?

Petersen: We hope that in the process of the creation of this development bank, together with all the other countries, we could reach a consensus around accepting these high governance standards and sustainability in infrastructure development.

It is important to secure a development bank that also counters corruption. So this could be a state of the art of new development bank in the international architecture.

I believe the AIIB will rise to be among the world's top organizations and the Danish government will try to help make that happen, together with other founding countries, and agree on the articles for the bank in a very open and transparent consensus-seeking process.

As the Danish ambassador to China, I am happy to see that so many countries in and outside Asia have shown interest in creating and participating in this new development institution.

We will use all our experience of development assistance administration for the last 50 years in Asia and Africa. We have a long track record of seeking poverty eradication, which is the overarching target for our development assistance. That should also be a strong feature of this bank.
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[TaiShang]

 

[ahojunk]

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AIIB and BRICS Bank Pose Threat to Bretton-Woods Dollar System – Engdahl / Sputnik International

AIIB and BRICS Bank Pose Threat to Bretton-Woods Dollar System – Engdahl

Opinion
21:50 10.04.2015 (updated 22:28 10.04.2015)

The rapid rise of the AIIB was foreseeable: the world's emerging economies got really frustrated when the US-dominated Bretton Woods institutions disregarded them as a "group of banana republics," F. William Engdahl noted.

Washington's policy makers have been ignoring the needs of the world's emerging economies for too long, treating them as a group of banana republics, noted F. William Engdahl, a historian and researcher, adding ironically – "they haven't had their eyes checked since 1944 apparently."

"At the 2014 BRICS summit in Fortaleza, Brazil, the five heads of state declared bluntly, "We remain disappointed and seriously concerned with the current non-implementation of the 2010 International Monetary Fund reforms, which negatively impacts on the IMF's legitimacy, credibility and effectiveness," the historian pointed out.

Indeed, in 2010 China, Brazil and other fast-emerging countries proposed a reform pledging to double the funds of the IMF in exchange for greater voting rights for such states as China, Russia, India, Brazil and some other countries.

The emerging powers consider it "manifestly absurd" that IMF voting rights on the Executive Board give France, with a $3 trillion GDP far more voting weight than China with its $10 trillion GDP, or provide Belgium ($500 billion GDP) with greater voting shares than Brazil ($2.2 trillion GDP). Remarkably, Washington retains a blocking veto share of votes and "is holding on like a pit bull to the old bylaws," the researcher noted.

However, the US Congress refused to reconsider the established status quo of the US-led Bretton Woods institutions and blocked the reform.

Thus far, China and other fast-growing economies decided to create an entirely new global monetary architecture with the Asian Infrastructure Investment Bank (AIIB) at the centerpiece.

The very next move made by the US has once again demonstrated Washington's foreign policy is being run by elites incapable of flexible response: by fiercely opposing the AIIB they "have royally shot themselves in both feet," remarked the author. The fact that the China-led initiative received global support has shown the impotence of the US-dominated Bretton Woods system.

As BRICS threatens to become an independent global actor, Washington has recently tried to carry out "its usual Color Revolution organized opposition protests," this time against Brazilian President Dilma Rousseff. Alas, it seems such a method is not working as it used to, the researcher pointed out.

Indeed, the AIIB and the BRICS Development Bank poses the greatest threat to the American dollar system and Washington's control over global financial flows since 1944. However, "peace and cooperation is a far more useful way to resolve affairs among civilized nations," the author emphasized.
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[terranMarine]

I call it the natural evolution of the current rusty financial system.