ABCs Of The AIIB

The 57 founding members of the China-sponsored Asian Investment Bank will meet on May 20 in Singapore. Many countries rushed to join the new development bank before the March 31 deadline even though key rules had not been decided. Even the size of the new institution had not it officially set.

Chinese initiatives often meet several of objectives. The development bank will help facilitate China’s foreign policy goals under the slogan of “One Belt, One Road.” This refers to the resurrection of the land-based Silk Road, complimented with a maritime initiative as well.

In seeking resources and markets, China’s focus is on its neighborhood: Asia. Many observers expect the PRC to seek regional hegemony before challenging the US global role. However, this is too static of an understanding, and does not give due to China’s long game approach. Specifically, within 15 years, Asia is expected to account for half the world’s GDP and two-thirds of the global middle class.

To dominate Asia will be to dominate the world. Early in the 20th century, the political scientists H. MacKinder proposed a geostrategic theory that he summarized as: “Who rules East  Europe commands the Heartland; who rules the Heartland commands the World-Island; who rules the World -Island commands the world.” 

It is like the four center squares on a chess board. Controlling those four squares makes it easier to win the game. MacKinder’s view, which continues to influence many (see Ukraine), is predicated on a euro-centric view of the world. That made sense at the start of the 20th century. It makes less sense at the beginning of the 21st century. China’s One Belt, One Road puts an Asian to MacKinder’s classic analysis. The center of the world economy is shifting to Asia. Indeed, for about a quarter of a century, more goods cross the Pacific than the Atlantic.  

The Middle Kingdom, which was the world’s largest economy for 18 of the past 20 centuries, is on its way to reclaiming perch. Chinese officials need not talk about challenging US global leadership. They know that be becoming the regional hegemon, it will succeed with loftier goals as well.