People walk at the headquarters of the Asian Infrastructure Investment Bank in Beijing, on June 15.JADE GAO/AFP/Getty Images
The Asian Infrastructure Investment Bank has no plans to work with Russian companies seeking infrastructure contracts amid Moscow’s invasion of Ukraine, it said Friday, rebutting allegations made by a former top communications executive.
Bob Pickard, who resigned Wednesday from the China-led development bank, said there had been a secret effort under way at the AIIB to meet with Russian companies and consider them in infrastructure projects funded by the institution.
Russia is a major shareholder in the AIIB, with a 6.7-per-cent share valued at more than US$6.5-billion. The country is also the target of Western sanctions over the war in Ukraine, which has killed thousands, forced millions from their home and caused billions in damages.
After Moscow launched its invasion in February, 2022, the AIIB said it was freezing “all activities” relating to Russia and its ally Belarus, saying ties with these countries were “under review” as a result of the conflict.
“AIIB put everything on hold with Russia after the war started,” Mr. Pickard said in an interview. “The bank should not be supporting Russia in any way, including commercially.”
In a statement Friday, the AIIB said this is still the case, saying all activities with Russia and Belarus “remain on hold.”
“In addition, we do not work with any sanctioned entities,” the bank said. “AIIB operates to the highest international standards and levels of governance. The Bank serves the interests of all of its 106 worldwide members. As such it is entirely independent from any member.”
It said that if any member has questions about its policies, including on procurement, they may request clarification.
After Mr. Pickard resigned in dramatic fashion Wednesday, accusing the AIIB of being controlled by the Chinese Communist Party, Ottawa announced it is freezing all activity with the bank. Canada has a roughly 1-per-cent stake worth around US$995-million, and was one of the first Western countries to join the Beijing-led initiative in 2017, alongside Belgium and Ireland.
Mr. Pickard said meetings to discuss partnerships with Russian entities were held in secret, with executives “taking great pains to conceal all knowledge” of them from bank members, as this “would have upset certain Western shareholders strongly supporting the Ukrainian side.”
“To do business with Russian companies, right now, in our world? I mean, that’s a pretty politically incorrect thing to do,” he said, adding he felt the initiative was emblematic of Chinese influence at the bank.
When asked about the new allegations, Adrienne Vaupshas, press secretary to Deputy Prime Minister Chrystia Freeland, said in a statement that “Russia has forfeited the right to be a member in good standing of the global economic community, and every institution, everywhere, should be re-evaluating ties with anyone who benefits from Putin’s criminal regime.”
Beijing has strongly supported Russia economically and politically since the war broke out, while purporting to remain neutral in the conflict. This week, Russian President Vladimir Putin sent a birthday greeting to Chinese leader Xi Jinping, wishing the 70-year-old good health, happiness and success.
“It is difficult to overestimate the effort that you have made over many years to strengthen our comprehensive partnership and the strategic interaction between our countries,” Mr. Putin wrote.
The AIIB earlier dismissed Mr. Pickard’s claims as “baseless and disappointing.” Following Ottawa’s announcement, the bank said it would co-operate with any review and “welcomed” the chance to clear its name.
China’s embassy in Ottawa said any claim the AIIB is controlled by the Communist Party “is nothing but a lie,” adding the bank has “rigorous internal organizational procedures and decision-making mechanisms.”
Founded in 2016, the AIIB now has more than 100 members, with Germany, South Korea and Australia all making major investments, taking stakes of between 3 per cent and 5 per cent each. China remains the largest shareholder by far, controlling more than a quarter of all votes.
In its 2021 annual report, the latest one on its website, the AIIB said it approved 51 projects across various sectors worth US$9.93-billion.
Beijing’s influence over the bank and its perceived use as a tool of Chinese foreign policy has led some critics in Canada to call on Ottawa to leave the AIIB, particularly as relations with China have worsened.
A briefing book prepared by Global Affairs Canada in 2019 and later published by a House of Commons committee grouped the AIIB alongside Mr. Xi’s signature Belt and Road Initiative – both of which it said were designed to leverage China’s “economic prowess to gain regional influence and export its model of governance around the world.”
For his part, Mr. Pickard said that as the “senior Canadian at the bank,” he had been unable to come up with a single reason for his country to be a member.
“I hope that our government will realize that it should not be part of this organization, which serves to increase China’s power,” he said.