The Obama Administration has advertised that by using “smart power” it would enhance U.S. influence around the world. So it’s worth noting an episode in which China is routing the U.S. in economic diplomacy.
Beijing has never made a secret of its belief in checkbook politics, and in recent years it has spent vast sums in pursuit of its regional ambitions: $40 billion for a Silk Road Fund to develop trade through Central Asia, $41 billion to lead a development bank with Brazil, Russia, India and South Africa, billions more in soft loans to countries in Southeast Asia, a “Maritime Silk Road” of ports across the Indian Ocean.
China’s latest venture is the $50 billion Asian Infrastructure Investment Bank, which is supposed to provide financing for some of the $8 trillion in projects that the Asian Development Bank estimated the region needs this decade. The Obama Administration has rightly opposed the AIIB, but its entreaties have been ignored.
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