Japan, China in race to finance building of Asia's infrastructure

Tokyo

SOMETHING approaching "infrastructure wars" have broken out between Japan and China.

This arises from the intense competition between the two countries to provide for Asia's infrastructure financing needs: Japan is the leading shareholder in the Manila-based Asian Development Bank (ADB) and China is leading the new Beijing-based Asia Infrastructure Investment Bank (AIIB).

Japanese prime minister Shinzo Abe cranked the tension up in Tokyo last Friday with his announcement of a "Partnership for Quality Infrastructure Investment for Asia's Future", in which he repeatedly emphasised the need for "quality" projects.

What he described as an "innovative" new scheme will apparently make available US$110 billion to finance Asia's infrastructure needs over a period of five years, although a senior diplomatic source told The Business Times that the percent…