The resignation of the senior Canadian at the Asian Infrastructure Investment Bank (AIIB) is a boost to Washington’s bid to undermine the multilateral financial institution. Calling for Canada to withdraw because the bank “serves to increase China’s power” reflects a hypocritical, pro-US Empire, position.
Recently Bob Prichard resigned as global communications chief for AIIB. He tweeted, “As a patriotic Canadian, this was my only course. The bank is dominated by Communist party members and also has one of the most toxic cultures imaginable. I don’t believe that my country’s interests are served by its AIIB membership.”
Immediately after Pickard resigned finance minister Chrystia Freeland suspended Canada’s involvement in the multilateral bank. The Conservatives, who objected to Canada joining AIIB five years ago, immediately celebrated. Pickard’s declaration garnered significant international press, boosting Washington’s bid to sabotage a bank with over 100 member states.
In subsequent interviews Pickard said Chinese Communist Party members have unofficial, untoward, sway over AIIB and that the bank secretly planned to work with Russian entities despite suspending ties after Russia’s invasion of Ukraine.
Pickard told CBC that he couldn’t think of a “single” benefit for Canada to be part of the bank. A former director at the Asian Development Bank and McGill University professor, Bart Édes rebutted Pickard in a Globe and Mail Report on Business commentary headlined “Canada must remain engaged with the Asian Infrastructure Investment Bank”. Corporate Canada is more likely to get contracts with Ottawa at the table.
Pickard’s central argument that the bank “serves to increase China’s power” is hard to dispute. Beijing established AIIB as an alternative to the US-based multilateral financial institutions. Irrespective of whether it “increases China’s power,” most countries prefer to have more financial options. Pickard offered little evidence of Beijing manipulating the institution to its ends even though there is copious evidence of the West doing so with the International Monetary Fund, World Bank, Inter-American Development Bank, etc.
Canada has repeatedly backed highly politicized measures by the Western-dominated multilateral financial institutions. Three months ago, it backed an $15.6 billion IMF credit to Ukraine, which was the first time the institution has ever loaned money to a country at war. The unprecedented move draws the institution into NATO’s fight with Russia. (In 2015, the IMF changed its rule to assist Ukraine despite Kyiv failing to pay $3 billion it owed Russia.)
As part of the campaign to destabilize Haiti’s elected government in the early 2000s, Canada and the US blocked $500 million in already-approved World Bank and Inter-American Development Bank loans to Jean-Bertrand Aristide’s government. Greater than the Haitian government’s annual budget, the move further immiserated the population and weakened the elected government.
In a similar vein, in 1972 Ottawa joined Washington in voting to cut off all money from the IMF to the elected Chilean government of Salvador Allende. After General Augusto Pinochet’s coup the next year, Canada voted for a $22 million ($100 million in today’s money) Inter-American Development Bank loan “rushed through the bank with embarrassing haste.” Ottawa also immediately endorsed sending $95 million from the IMF to Chile and supported renegotiating the country’s debt held by the Paris Club.
In October 1982, Canada delivered 4.91 percent of the votes that enabled Western powers to gain a slim 51.9 percent majority in support of apartheid South Africa’s application for a billion-dollar IMF credit. Sixty-eight IMF members opposed the loan as did 121 countries in a nonbinding vote at the UN General Assembly. Five IMF executive directors said South Africa did not meet the standards of conditionality imposed on other borrowers. The Canadian minister of finance justified support for the IMF loan claiming that “the IMF must be careful … not to be accused of meddling in the internal affairs of sovereign states.” A few months later, Ottawa opposed IMF funding for Vietnam because of its occupation of Cambodia (largely to stop the Khmer Rouge’s killing).
Far and away the most egregious politicization of multilateral financial institutions was their push to promote Structural Adjustment Programs (SAPs). The IMF and World Bank compelled dozens of countries to radically reform their economies along neoliberal lines. The Canadian International Development Agency and other bilateral donors made their funding contingent on countries adopting SAPs that often had devastating social impacts.
Considering Ottawa’s history with multilateral financial institutions, it is hard to take seriously a Canadian official complaining about China politicizing the Asian Infrastructure Investment Bank. The world, especially poorer countries, is better off with alternatives to the Western-dominated multilateral financial institutions. The AIIB provides an alternative. And that is precisely why Canada and the US Empire oppose it.
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