BEIJING — China’s state media indulged in a bit of gloating Wednesday, as Europe’s most powerful nations announced they planned to join a Chinese-led Asian regional bank, ignoring objections from the United States.
In a commentary piece titled “Washington, what are you waiting for?” state news agency Xinhua described the United States as “petulant and cynical” for declining to join the Asian Infrastructure Investment Bank (AIIB). It said the bank was open to all nations but said Washington’s “sour grapes” left it looking “isolated and hypocritical.”
On Tuesday, Germany, France and Italy said they planned to join the bank, following Britain’s decision to do so last week.
Officials from Australia and South Korea also have indicated they are considering joining the bank in recent days, after initially declining to do so.
The United States was sharply critical of Britain’s decision last week, with an unnamed administration official telling the Financial Times that it had been made with “virtually no consultation with the U.S.” and accusing London of “constant accommodation” of China.
China proposed the bank in 2013 to finance investment in infrastructure across Asia and had pledged to put up most of its initial $50 billion in capital. Earlier this month, China said 27 nations had signed up to be founding members.
The United States has denied that it lobbied its allies not to join the bank. It says that it welcomes the idea of an infrastructure bank but “strongly urges it meet international standards of governance and transparency.”
Fearing that the AIIB will become a rival to the World Bank, it is worried that its lending programs will not include adequate safeguards over issues such as the environment and labor rights.
But the European decision to break ranks with Washington represents a significant diplomatic setback for the United States.
“The administration has made a major mistake. Not just our refusal to take part in the bank, but the pressure on our allies not to take part, was very short-sighted,” said David Sedney, a senior fellow at the Atlantic Council and former senior State Department official. “I understand the concerns about standards, but being in opposition to it has meant we don’t have the ability to influence it. And it is clearly going to go ahead whether we support it or not.”
Sedney said there was a “strain in U.S. political thinking that says if we are not in the lead role, we should not be part of it — but I think that has been a mistake.”
China’s Foreign Ministry spokesman, Hong Lei, welcomed the Europeans’ decision to join the bank and urged other countries to join. At a regular news conference Wednesday, he said the bank would maintain high standards and learn best practices from other multilateral institutions.
“The AIIB aims to benefit people all around Asia,” he said. “Most countries in Asia are developing countries, which lack money for infrastructure projects.”
But U.S. Treasury Secretary Jack Lew appeared unconvinced, urging countries to think twice before joining.
“I hope before the final commitments are made, anyone who lends their name to this organization will make sure that the governance is appropriate,” he told lawmakers Tuesday, according to Reuters.
The United States enjoys a dominant position in the World Bank and the International Monetary Fund, but European and Asian nations have grown increasingly frustrated with its failure to agree to reforms of voting rights in the IMF that would give China and other emerging nations greater say.
Lew acknowledged that the failure by Congress to agree to a “very mild and reasonable” set of reforms of the IMF had prompted countries to look elsewhere.
Thomas Wright, director of the Project on International Order and Strategy at the Brookings Institution, wrote that the U.S. approach toward the AIIB had been “confused and contradictory,” while Paul Haenle, director of the Carnegie-Tsinghua Center in Beijing, said the administration had “played it very badly.”
“We are going to come out looking insecure and weak,” Haenle said. “They probably didn’t give us enough notice, and U.S. concerns about governance are legitimate concerns, but you need to be part of it in order to be able to shape it.”
But Wright also argued that “Britain should not be let off the hook” for a decision solely based on commercial interests rather than a strategic assessment of how to promote stability in East Asia.
Several experts pointed out that the United States had long urged China to take a stronger leadership role in global affairs but then had raised objections when Beijing did just that.
“We are pushing the Chinese to contribute more, to be a responsible stakeholder, to take a greater role where they can in helping resolve problems,” Haenle said. “But in many cases when they do step forward and say, ‘Well, this is what we are going to do,’ our instant knee-jerk reaction is to say, ‘What are you doing here?’ ”
Xu Yangjingjing contributed to this report.