The Institutional Power In The Asian Infrastructure Investment Bank And The Way It Works: Is China Questing For Absolute or Relative Gains?

ABSTRACT: Since the foundation of the Asian Infrastructure Investment Bank (AIIB) there have been a lotof debates amongst politicians and academics on the Bank‘s objectives. Although these debates inform a lotabout the AIIB, they lack a theoretical support and therefore sequential explanation. This is to say thosecriticizing the AIIB as a China‘s tool to carry out relative gains anchored on China‘s great institutional powerassumption cannot demonstrate evidence that it is really funneling its objectives through the AIIB. In turn, thosepraising China‘s initiative of creating the AIIB as an indication of its willingness to participate in theinternational system under the current rules as a way to ensure absolute gains, also present shortcomings toexplain why China controls the organization more than would be expected if it really wanted to be constrained.Then, both the accusations against the AIIB and praises to it do not stand up to close scrutiny. This article findsout that there is an alternative offshoot of realism, here called realism institutional that narrow this gap byhandling a very important concept – institutional power -, which is neglected by the mainstream theories,neorealism and neoliberal institutionalism. From this theoretical account, China possesses the institutional powerin the AIIB contrary to the neoliberal institutionalism prospect, albeit is not using it in the way would beexpected by neorealism assumptions. This finding throws some theoretical light on the apparent contradiction onwhy China is seeking for bigger institutional power and at the same time is embracing self-constraint in theAIIB. In fact, the AIIB makes part of China‘s charm policy of backing the absolute gains while seeks for relativegains.

KEYWORDS:The AIIB, institutional power, realism institutional, absolute and relative gains.