VietNamNet Bridge - Vietnam still has not provided an answer to the question on whether to join AIIB. Meanwhile, economists have called on the government to think carefully before making a decision. 

China, the founder of the Asian Infrastructure Investment Bank (AIIB), states that AIIBV aims to help develop Asian economies, especially in infrastructure.

However, the US and Japan says China may target another goal – consolidating its position in the global financial market – when suggesting setting up AIIB.

They have every reason to worry about this. AIIB, an international finance institution, in principle, will have to respect international law in its operation. However, AIIB is established by China, which many times has ignored international practice. Meanwhile, it contributes 50 percent of capital to the institution.

Another concern has been raised that China may use AIIB as a financial instrument for its political purposes. Experts warned this is really a high risk. China could impose some strict conditions on Asian countries in exchange for  loans from AIIB.

Besides, people fear that if China cannot eliminate embezzlement to the very root, AIIB could become a new seed of corruption. 

Dr. Nguyen Tri Hieu, a Vietnamese renowned economist, noted that AIIB could also serve as a tool for China to implement its plan to turn yuan into the convertible currency in the world. However, whether China can succeed with its plan remains controversial.

Should Vietnam join AIIB? This is an attractive offer: if Vietnam becomes the founding member of the bank, it would be able to enjoy more preferences than common shareholders.

However, China may impose conditions on Vietnam to follow in exchange for the loans.

While Hieu calls on the government to think carefully about the AIIB’s membership, some other analysts have urged to say “no” to the Chinese initiative.

The analysts warned that the membership would make Vietnam more heavily reliant on China, especially when Chinese firms are the EPC (engineering, procurement, construction) contractors in 90 percent of the projects in Vietnam), i.e., Chinese workers, construction materials and technologies are used in the projects.

It is estimated that China makes 51 percent of total steel and 53 percent of cement output globally. Therefore, it is understandable that China wants other countries to consume its cement and steel.

Meanwhile, Dr. Le Dang Doanh, a renowned economist, former head of the Central Institute of Economic Management (CIEM), noted that whether AIIB brings opportunities to Vietnam or makes it more reliant on China would depend on Vietnam itself.

“Vietnam would have to be cautious about accessing the bank’s loans and avoid reliance on it,” Doanh commented.

Dat Viet