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Asian Infrastructure Investment Bank Bill 2017: Second Stage (Resumed) (Continued)

Wednesday, 31 May 2017

Dáil Éireann Debate
Vol. 953 No. 1

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(Speaker Continuing)

[Deputy Richard Boyd Barrett: Information on Richard Boyd Barrett Zoom on Richard Boyd Barrett] Of course, we have now seen echoes of this with the EU-IMF structural adjustment programme called austerity, which was imposed on us when we found ourselves sucked into this cycle, and we are still affected by it. Members should think about what happened with our strategic investment fund here. We have to privatise as part of those investments. We have €4 billion but we have to allow the market into those investments and somebody else has to make money out of it. We are tied into that because of the strings that are attached in fiscal treaties and so on with European arrangements to which, crazily enough, we have signed up. The severe negative impact is evident and affects, even as we speak, our capacity to invest in social housing, health care and all that. We are restricted and denied the right to invest even our own money in the social housing we desperately need, creating the incredible irony that Ireland could build more social housing in the 1930s, 1940s and 1950s when it was poorer - virtually a Third World country but where we had control over our own investment and expenditure - than we can deliver in the early 21st century.

We are beginning to get a taste of this, but the poorer countries of the world have been suffering from this since at least the 1980s and the 1990s. It has had a devastating effect on those countries. Now we are planning to do an Asian version of this, with China in the lead, India playing an important role and Germany, obviously, involved as one of the other big participants. We are a minor player in it but as the Minister indicated, we want to be seen to be part of the club with these big boys. It is interesting that the United States and Japan do not want to get involved in this because they see this as a potential rival to the World Bank and as part of the intensifying competition between the big economic blocs of the United States and the western blocs on the one hand and China on the other. Do not get me wrong. I do not feel sorry for Donald Trump and the US in its fears about the growth of Chinese economic power or a rival power to the United States but the point is that we should recognise all these big, super-economic blocs, which essentially are trying to engage in forms of economic imperialism and colonialism in their regions, as being a major problem for the world. They ultimately accelerate the flow of wealth from the have-nots to the haves, from the poor countries to the rich countries, from the working people to the big bankers, the big financiers and the big corporate interests that dominate in influence and with their positions in institutions like the Asian Infrastructure Investment Bank, AIIB, the World Bank, the IMF and so on.

This is a power grab by a rising power, China, to get in on the act that has been monopolised by the IMF and the World Bank, and to rival it. In the competition that is intensifying between the US bloc and the rising Chinese bloc, the losers will be ordinary people in those countries, in China itself, in surrounding countries and the surrounding region and indeed the whole world with regard to the environment. They have a callous, cavalier disregard for the environment and the consequences, as well as the rapidly accelerating gap between the haves and the have-nots on a world scale. This institution will further accelerate and intensify that mode of organising global economic activity. That is what it is about, namely, about China getting in on the act and us facilitating that. I do not think we should. I think there are better ways that we could spend €125 million to do things that we need to do here. I am not saying we should not use moneys that we have to help other countries that need support and investment but not via institutions like this, which are all about squeezing as much back out as they possibly can. These institutions are not about benign aid or assistance and solidarity but are about lending money to get back extortionate interest and to gain control over governments, investment policies and countries' actual physical infrastructure and services at the expense of the people and the environment in those countries.

I will conclude on that but these points must be made because this is a significant development. The sad history of the World Bank and IMF on the global stage over the past 20 or 30 years should really make us reconsider why we would want to get involved in another project of this sort, which is destined to do the same sort of damage that the IMF and World Bank have done.

Deputy Thomas P. Broughan: Information on Thomas P. Broughan Zoom on Thomas P. Broughan I am grateful for the opportunity to briefly comment on the Asian Infrastructure Investment Bank Bill 2017. This Bill is to obtain Oireachtas approval for Ireland to join the AIIB before the end of 2018 and it is a strong indication of the dramatic changes which have taken place in the global economy over the past three decades. The rate of development of the BRICS economies in particular, despite recent slowdowns in growth, show the dramatic rise in the share of world production by the BRICS countries and especially by China. That economic development is mirrored in the Minister’s decision to join the bank, which has 57 founding signatories from June 2015 and up to 25 African, European and South American countries, including Ireland, Belgium and Canada, look set to join this year. Including the 52 countries that have ratified the bank's articles of agreement, up to 77 countries may have joined by the end of the year.

The AIIB was first proposed by President Xi Jinping of China in a Bali conference in October 2013 and President Xi seemed to envisage the bank as a new international development bank, raising major capital to fund roads, rail, power and communication grids across Asia. Although initially welcomed by Secretary of State, John Kerry, the Obama Administration remained very suspicious of the proposal and tried to dissuade its closest allies like Britain, Germany, Australia and South Korea from joining the organisation. The Cameron Conservative Government, perhaps anticipating the difficulties the current Government or the Government in place after the general election will face in Brexit, decided to become a founding member of the AIIB and its $100 billion fund.

At the time, human rights groups and promoters of multi-party democracy in Hong Kong and China felt that the UK was too willing to placate the Chinese Communist Government and these concerns remain regarding our Government’s proposal. Deputy Richard Boyd Barrett reminds me that, many times in this House, I have raised the situation of Tibet and the Uyghur nations. Huge territories of the People's Republic of China are, of course, distinct nations, and there has been grotesque repression in them over the last 40 to 50 years.

Many observers have questioned the need for a new Asian development bank, given the past role of the US-led World Bank, the International Monetary Fund and the Japanese-led Asian Development Bank. The Obama Administration and other economists openly worried that China will use the AIIB to set its own Asian and global economic agendas and will ignore environmental protections and standards. Human rights, especially of workers on large infrastructural projects, anti-corruption standards - in tendering and awarding of contracts in particular - and company governance standards are concerns. We have seen the massive expansion of the Chinese Government's export economy and infrastructural development in so many countries of Africa, which has raised many questions about basic rights, especially for workers and native populations.

American Governments have long called on China to assume a leadership role in the global economy and to prioritise infrastructural development in Asia. China has also complained that the Bretton Woods architecture, the development of which was led by the US after the Second World War, refuses to recognise the massively growing role of China in the world economy. The Asian Development Bank is dominated by Japan and headquartered in Tokyo, and its voting share at that bank is more than twice that of China.

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