Abstract
This article addresses selected issues enmeshed into global economic governance debate. It focuss on a role of international institutions in transforming world order, in particular the rise of emerging powers increasingly categorised or acronymised as BRICS, their resources, power and vested interests. The main narrative brings close the phenomenon of the new reshuffling in multilateral development banking (MDB). The New Development Bank (NDB), and the Asian Infrastructure Investment Bank (AIIB) as ‘products’ of the third wave of MDB emergence, fit well into the process coined as ‘the recalibration of the world economy.’ It is expressed by shift of the centre of global economic gravity towards non-western actors and can be explained by arguments derived from game theory. They elucidate exit – voice nexus, where the cost of exit for both organisation leaders (Western donors) and members (EMDCs, BRICS) is fragmented multilateralism and where thecost of voice is decreasing capacity to influence principles and procedures of multilateral development lending. The article in the first section starts with overview of three waves of multilateral development banking, where the most recent of them is partially explained using game theory argument. Second section starts from accentuating common characteristics of NDB and AIIB and then examines the differences between NDB and AIIB – entities which emerged during the third wave. The final section provides summaries and conclusions.
Highlights
The New Development Bank (NDB), and the Asian Infrastructure Investment Bank (AIIB) as ‘products’ of the third wave of multilateral development banking (MDB) emergence, fit well into the process coined as the recalibration of the world economy
Second section starts from accentuating common characteristics of NDB and AIIB and examines the differences between NDB and AIIB – entities which emerged during the third wave
At first broadly defined as a regional development bank, the European Investment Bank (EIB) with the lapse of time began to be considered in the EU rather as “an autonomous instrument of one or more common policies, including industrial policy and development cooperation policy [...], promotion of economic and social cohesion – a principle reaffirmed in the protocol annexed to the Treaty of Maastricht – in conjunction with assistance from the Structural Funds and other Community financial instruments” (Bussière et al, 2008)
Summary
Brics and New Multilateral Development Banks: Towards Recalibration of Global Economic Governance. Many observers comment that New Delhi is obsessed with Beijing’s rise in the world politics and this is a recurring subject of domestic political debates in India, as opposite to China, which is much more self-confident as the Asian primary power (Malone, Mukherjee, 2011: 137) Both countries strive to leave their imprints on global economic governance structures and shape the international order with their accumulating might, but with some of the world’s highest levels of inequality and weak prospects of reconciling growth with equality their ascendance is filled with uncertainities (Rewizorski, 2017). The New Development Bank (NDB), and the Asian Infrastructure Investment Bank (AIIB) as ‘products’ of the third wave of MDB emergence, fit well into the process coined as the recalibration of the world economy It is expressed by the shift of centre of the global economic gravity towards non-western actors and can be explained by the arguments derived from the game theory. Brics and New Multilateral Development Banks: Towards Recalibration of Global... 283
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