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AIIB tries not to get entangled in Russia-Ukraine turmoil

6 March 2022

The Asian Infrastructure Investment Bank (AIIB), on 3 March, decided to halt all current and pending business in Belarus and Russia due to the ongoing Russia-Ukraine conflict. This decision marks the first departure in the economic relationship between China and Russia.

The AIIB has an official stance of political neutrality, however, China is its largest shareholder and it was seen as part and parcel of the Belt and Road Initiative (BRI) when it started operations in 2016.

After Russia hinted at and started implementing measures to prevent capital flight, foreign companies and banks have tried to limit their exposure to Russia by pulling their investments out of the country altogether. The AIIB said, “We the management will do our utmost to safeguard the financial integrity of AIIB, against the backdrop of the evolving economic and financial situation”. While the bank lent $500 million to fund an infrastructure project in Russia in 2019, only 3% of the bank’s total loans are in Russian projects meaning its exposure to Russia is low.

The AIIB’s decision could signal increasing political pressure in China to decouple from Russia. The relationship between Russia and China, which China declared as having “no limits”, is under increasing scrutiny due to the conflict in Ukraine. The bank’s decision may show the ‘limits’ to the relationship between the two countries. On the other hand, as the AIIB has not invested heavily in Belarus nor Russia, the move may be a low-cost manoeuvre to remove itself from increasing western sanctions that are sending shockwaves throughout the region.

China has abstained from multiple United Nations votes condemning Russia, however, the Chinese government have said that they “deplore” the conflict and are trying to secure a ceasefire. The two governments succeeded in seeking closer ties, highlighted by the agreement around space, climate change, and artificial intelligence signed just before the start of this year's Beijing Winter Olympics. Nevertheless, there are signs that China is becoming increasingly uncomfortable with events in Ukraine. The decisions of banks, as well as companies, with links to China may be indicative of possible shifts in the Chinese position

Sources: CommonSpace.eu with Financial Times (London), Nikkei Asia (Tokyo), Reuters (London), and other media agencies

Picture: Asian Infrastructure Investment Bank (AIIB)

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UAE says it will withdraw from Yemen, but division emerges in Yemeni presidential council

31 December 2025

In a move seen as an attempt to de-escalate a crises with Saudi Arabia, the United Arab Emirates, on Tuesday (30th December) announced that it was heeding a call to withdraw its troops from Southern Yemen. UAE says that its presence included counter-terrorism teams that were crucial in fighting against Islamist groups. UAE sources said that parts of Yemen not controlled by the Houthis have had Al Qaeda in the Arab Peninsula (AQAP) operatives using the territory to launch attacks on Europe, the US and Middle East. UAE teams have co-ordinated with American and British special forces and intelligence. The sources added that Emirati forces and their Yemeni allies also helped reverse Houthi gains in the south. including the liberation of Aden port. The small UAE contingent has remained in place since the UAE withdrew most of its military personnel in 2019. The leading English-language newspaper in Abu Dhabi, The National, said that the main UAE force was based at Riyan Mukalla International Airport, with access to fixed-wing aircraft and helicopters, but also operated smaller contingents in the port town Balhaf and Shabwa. "It is understood it also flew a number of drones from the airbase that were able to track terrorist movements, pass information back to its allies and assisted special forces' missions." Meanwhile a division has emerged in Yemen's presidential council after four members denounced what they called the 'unilateral decisions' by the chairman. Four of Yemen’s eight Presidential Leadership Council members on Tuesday denounced an announcement by the council’s chairman accusing him of breaching the governing agreement. Tension between Yemeni leaders has been rising for weeks, underscoring the fragility of the country's already fractured political landscape and further complicating efforts to confront the Iran-backed Houthi rebels. The latest rift took an unprecedented turn on Tuesday morning, marked by a Saudi-led coalition “limited operation” striking combat vehicles Riyadh linked to the Southern Transitional Council, which has three members in the PLC. The PLC Chairman, Rashad al Alimi, on Tuesday said that he was seeking to cancel the joint defence agreement with the UAE. “What has been issued … constitutes a clear violation of the Declaration of the Transfer of Power [agreement], which explicitly stipulates that the Presidential Leadership Council is a collective body whose decisions are taken by consensus, or by majority when consensus is not possible,” the statement by the four members said. “It does not, under any circumstances, allow for unilateral decision-making on sovereign, military, or major political matters." The statement was signed by STC chief Aidarous Al Zubaidi, Faraj Al Bahsani, Tariq Saleh and Abu Zaraa al Muharrami. (click the picture to read the full article).

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