The New Development Bank (NDB), a partnership among the BRICS (Brazil, Russia, India, China, and South Africa) countries, has been praised as an alternative to the traditionally Western-dominated Bretton Woods institutions. The NDB was founded to “mobilize resources for infrastructure and sustainable development projects in BRICS and other emerging and developing economies.” But for the NDB to be taken seriously as a substitute for the IMF and the World Bank, the BRICS countries, China in particular, need to do a better job promoting it. China’s performance at the recent 70th Annual Session of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP), presumably an ideal venue for broadcasting the NDB, illustrates the problem.
UNESCAP is a regional policy forum held every year; this year’s theme was “regional connectivity for a shared prosperity.” The conference this year was held in Bangkok, and was attended by more than 40 member countries. Yet China had only ten delegates present. Japan, by comparison, sent twenty six, and even Bhutan, the Philippines and Thailand had a bigger presence than China did.
Given that the bank will be headquartered in Shanghai, and that China will provide the largest share of capital to the its contingent reserve arrangement, China is set to become the senior partner in the NDB. It seems reasonable then, that China will assume primary responsibility for marketing the bank. Moreover, taking on the senior role gives Beijing the potential to achieve two of its foreign policy goals. It can assume a global leadership role, showing that this rising power is capable of acting within an established international system. Second, control over the banks’ finances allows China to exert economic clout across the Asia-Pacific.Enjoying this article? Click here to subscribe for full access. Just $5 a month.
But to accomplish either of these goals, China needs to market the NDB. The UNESCAP forum was an ideal place for doing just that. Yet it seems China blew its chance. Not only did it skimp on delegates, none of the delegates it did send appeared on the ministerial panels as either panelists or moderators. These panels were highly pertinent to the issues the NDB was meant to address: themes included the unique development challenges for landlocked and Small Island Developing States as well as “Asia-Pacific Perspectives on Sustainable Development and Development Financing.” The lack of Chinese participation meant a missed opportunity for it to highlight the NDB at these events, exactly where China would want to market the bank as a source of development finance.
And there are other reasons why this forum would have been a good place to promote the NDB. This conference occurred under the mainstream media radar, meaning that China likely could have avoided the attention of the Western states that traditionally dominate the IMF and World Bank. There were a grand total of thirteen delegates from Western countries in attendance, including observers. If China wanted to avoid having Western development institutions feel threatened, this was the forum to do it.
Russia and India, two other BRICS countries that were in attendance, could also have played a major role in marketing the NDB – after all, it is their bank too. But neither Russia nor India featured more prominently than China among the ministerial panels. The government of Japan, however, a major competitor in the race for economic soft power in Southeast Asia, co-organized a panel with UNESCAP. A vice-president of the Asian Development Bank was also attending, as a panelist addressing regional connectivity. In short, advocates for the NDB were few and far between, whereas alternative sources of finance were in full view.
There are, of course, reasons why Chinese finance might not feature heavily on a panel about sustainable development. China’s record with regards to the environment is, of course, less than stellar. But having a Chinese delegate on the panel would allow China to confront these concerns rather than letting them fester. Moreover, a Chinese panelist would allow China to remind other delegates that the NDB is a partnership between BRICS states, so one cannot assume that every project will exclusively reflect Chinese tendencies, even if China is the dominant force behind the bank.
China needs to do a better job marketing the NDB to developing countries. The 70th UNESCAP forum would have been an ideal forum for extolling the bank’s merits, but China missed the opportunity. To be taken as a serious alternative to establishment institutions like the IMF and World Bank, China needs to show how the NDB represents a unique means of solving development problems. So far, that has not happened.
Matthew Ribar is a student in the College of William & Mary–University of St Andrews Joint Degree Programme, as well as a research assistant for the Teaching, Research, and International Policy (TRIP) Project.