Description: The existing account about the China-led multilateral development bank – the Asian Infrastructure Investment Bank (AIIB) – has been focused on the American policy concerns and the economic and commercial reasons for China to establish it. Two deeper questions are left unaddressed: Was there any strategic rationale for China to initiate a new multilateral development bank; and why could the US not persuade its key allies, with the exception of Japan, to boycott the AIIB? From a rationalist perspective, this paper argues that China felt threatened by the Obama administration’s rebalance to the Asia-Pacific strategy. In response, China opts for a soft-balancing policy whereby it creates a regional security space in Eurasia to mitigate the threat coming from its east. China’s material power, premised on the fact that the country is a huge domestic market and flush with cash even after the global financial crisis and the European sovereign debt crisis, has proved irresistible for other Western states that they were enticed away from the USA. This paper adds weight to the claim that the US has fallen into a relative decline in economic governance in East Asia.
Bio: Lai-Ha Chan is a Senior Lecturer at the China Research Centre, UTS. Lai-Ha was educated in Macau, Hong Kong, New Zealand and Australia. Before going to Australia for a PhD research programme, she worked for the Hong Kong SAR Government. Her Master’s thesis at Victoria University of Wellington, New Zealand was awarded the New Zealand Asia 2000 Prize for the Best Thesis. One of her recent articles, “Rethinking Global Governance: A China Model in the Making?”, published in Contemporary Politics, 14 (1), 2008, won a prize for the Best Article in the journal in 2008.
Lai-Ha has published, individually and collaboratively, two scholarly books, one edited volume, and a number of peer-reviewed journal articles and book chapters. Her sole-authored book China Engages Global Health Governance: Responsible Stakeholder or System-Transformer? (Palgrave, 2011), is the first book-length study of China’s participation in global health governance and its intention for global governance. Using HIV/AIDS as a case study, this book employs International Relations theories about global governance and world order to investigate the process of China’s engagement with global health governance as well as its implications for the emergent world order in the context of China’s rapid rise in power.
Another book, China Engages Global Governance: A New World Order in the Making? (Routledge, 2012), is a collaborative work with scholars in New Zealand and the United Kingdom. The book comprehensively covers issues of Chinese perspectives on global governance, including international peace and security, international finance and trade, human rights and humanitarian intervention, environmental protection, public health and food safety, energy security and transnational organized crime.
The third book is an edited volume, China at 60: Global-Local Interactions (World Scientific, 2011). Lai-Ha is the lead editor and a contributor of this volume. It explores the interactions between China and the world over the course of the 60 years of the Chinese Communist Party’s rule since 1949 and the impact of these interactions on China’s domestic development. Focus is on the domestic impacts of China’s increasing engagement with the world, the global implications of China’s reform efforts and growing power, and the long-lasting uniqueness of this non-European rising nation.