Draft Asian Infrastructure Investment Bank (Initial Capital Contribution) Order 2015

Jeremy Lefroy Excerpts

Monday 19th October 2015 General Committees

[Jeremy Lefroy (Stafford) (Con)]

I draw Members’ attention to my entry in the Register of Members’ Financial Interests as chairman of the Parliamentary Network on the World Bank and International Monetary Fund.

I have four questions. The first follows up the point made by the hon. Member for Feltham and Heston on overseas development aid. I imagine that our contribution will be made from our overseas development budget and will be counted as part of ODA. ODA can be applied only to low and middle-income countries, so I would welcome confirmation that the rules of the bank will prevent it from investing in or lending to countries that are not low or middle-income countries.

My second question is about the directorship. Our World Bank director is the Secretary of State for International Development, whereas the Chancellor of the Exchequer is our director of the International Monetary Fund. I notice that, for the AIIB, which is also a multilateral development bank, our director will be the Chancellor of the Exchequer. I wonder what the difference is between the work of the World Bank and of that development bank, and whether any consideration was given to whether the AIIB should also be part of the remit of the Department for International Development.

Thirdly, as the Minister will know, the World Bank has four major bits. The first is the development bank—the International Bank for Reconstruction and Development. The second is the International Development Association, which is very much a soft fund, largely for giving grants to low-income countries. Is it expected that the AIIB, a development bank, will follow the World Bank in doing that? The third part of the World Bank is the International Finance Corporation, which invests in private sector equity. Again, I wish for clarification as to whether the AIIB intends to do that. The fourth part of the World Bank is the Multilateral Investment Guarantee Agency, or MIGA, which puts out guarantees rather than direct financing. Is it intended that the AIIB has an arm of that type as well?

Finally, as I said, I chair the Parliamentary Network on the World Bank and International Monetary Fund, which seeks to inform parliamentarians of countries that are members of those organisations and to give some form of accountability, so that we can look at what work is being done. Is it intended that a similar form of parliamentary network will be established for parliamentarians of the 57 countries so far engaged with the AIIB, to ensure that it is accountable in some way to parliamentarians in the countries that have invested in it?