Beijing-Tokyo battle rages for mega infrastructure projects

AS the formal opening of the Asian Infrastructure Investment Bank (AIIB) draws near with the approach of 2016, it might seem that a struggle for supremacy between the new China-led bank and the long-established Japan-led Asian Development Bank (ADB) is imminent. But the real "war of the giants" has moved to a different theatre.

It is no longer a "proxy war" between two institutions - the AIIB and the ADB, with China and Japan as their respective largest shareholders - but a gloves-off battle between Beijing and Tokyo for mega infrastructure projects, among which high-speed rail networks and nuclear power plants dominate.

The significance of this shift appears to have escaped general attention but it raises fundamental questions about the way in which funding and operational demands on the two regional development banks are likely to evolve, and their possibly chan…