AIIB funding of project is predicated on factors like the sustainability, the environmental friendliness which implies how the project would not cause a serious imbalance in environmental protection. But in situations where the importance would impact and encourage development and fight poverty, the environmental impact factor might be played down provided it is not so weighty to create another big problem. The last factor is the social acceptability - implying that the people of the community the project is to be sited must be ok with it and it must target to improve on their livelihood.
"AIIB structure, projects and funding must be lean, clean and green. By these I mean that the membership must be manageable and not too bogus, and we believe that the more the better. The project funding must be clean and that means there must be no form of corruption in the process leading to the funding and in the execution. It has to be clean to the extent of encouraging a clean and non-polluted environment. As I said earlier, on this we also consider the benefits when the environmental impact is bearable. For instance, in the U.S.A today, most of the states, or almost all the so-called 'Red States' still rely on coal power station for electricity and it is not foreseeable in the next 30 years that fossil fuel would be done away with because of the carbon emission. What is steadily done is ensuring its effect is minimized. So in a place we find that coal power plant for instance is needed as the only way the people would be assured of power supply enough to encourage economic growth, we will find a way of minimizing the emission effect and go ahead with the project to strike a balance."
U.S. initial fear
Jin admitted that: "At the formation of the AIIB, the U.S., the base of the Bretton Wood Institutes that manage the world economy including the World Bank and the IMF, saw the new body as a threat to its dominance and importance in the world economic order. They raised issues on whether the bank's functions would be consistent with fundamental human and environmental rights of the borrowers or state members. We did our best to convince them that we were no threat or rivals or either naive as not to know the basic rules of operations. And moreover, we believe there is enough space in the global economic theatre for several bodies to operate, and many regional development banks operate side by side the World Bank and there is no reason the AIIB would be the violator. We rather need to work with and benefit each other to create a better world.
"For instance, Asia alone needs as much as $1tr infrastructure funding every year and the World Bank hasn't such pool of money to pick the bills therefore the need for an alternative. Moreover, if the AIIB exists just like the World Bank, there is no time the new body would embark on a project of building a power plant, airports, roads or seaport to boost the economy of any country that the World Bank will still vote funds for the same project. So if the AIIB handles one project and the World Bank takes another that is a lot better for the world towards defeating poverty and hardship."
On the management of the bank, the president stated that right now, the AIIB operates a lean workforce of about 90 workers and operates solely from the head office in Beijing as a strategy to save cost and may continue that way for a long time. He however hinted that with time as the need arises, the bank may operate little outlet offices just to handle needs as it would stick to the rule of cost effective management.
To make its operations adapt to global best practice standards, he said the AIIB adopts universal procurement approach to get the best manpower and equipment and also recruits experts from everywhere in the world based on their competence irrespective of whether the country of origin of such expert is a member of the AIIB or not. That way, it is sure to harness the best hands to run its operations.
