December 1, 2023

Investment Banking

Let Your Investment Banking Do The Walking

Asian Infrastructure Investment Bank too intertwined with Beijing, former communications head says

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A man walks past the headquarters of the Asian Infrastructure Investment Bank, in Beijing, China on July 27, 2020.TINGSHU WANG/Reuters

Bob Pickard, a Canadian who recently quit the top communications job at the China-led Asian Infrastructure Investment Bank, says his time there confirmed for him that the multilateral institution is a tool of the Chinese government, something he had previously thought was an unfair stereotype.

“I went into the job with the greatest of aspirations to take what I thought was a misunderstood institution and correct what I thought was a mistaken image,” said Mr. Pickard, a 30-year veteran of the public relations industry who began working for the bank as its director general of communications in early 2022 and departed in June.

The Beijing-based institution, which Canada and other countries have joined over the opposition of the U.S. government, is supposed to be an organization of more than 100 nations, devoted to working on Asian development projects in the common interest. The People’s Republic of China is ostensibly just one member.

In reality, Mr. Pickard said, he found that the bank is controlled by Beijing’s ruling class, who use it to serve China’s geopolitical ambitions and expand the influence of the Chinese government. He is now recommending that Canada quit the institution, noting that relations between Ottawa and Beijing have deteriorated since Canada joined in 2017.

“What I found after a very little while is that the there’s a lot of truth behind the stereotype” about the bank, he said.

Mr. Pickard has since returned to Canada, where he was debriefed by the federal Department of Finance, which is led by Deputy Prime Minister Chrystia Freeland. The Canadian Security Intelligence Service, the country’s spy agency, has also asked to speak to him, he said. That meeting will take place in the weeks ahead, he added.

The Canadian government halted its activity with the bank and announced it was reviewing its membership in the entity after Mr. Pickard resigned. On Monday, Finance spokesperson Martin Bégin said the review is continuing.

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The bank has rejected Mr. Pickard’s criticisms, calling them baseless. It released the findings of an internal review of his allegations in July, saying the bank’s governance “is functioning as intended,” and that the investigation had found “no evidence of undue influence on decisions taken by the board of directors or management.”

Mr. Pickard, who has worked in Asia for more than half his career, said he was shocked to learn during the course of his work at the bank that the personal assistant assigned to him, a member of China’s Communist Party, was secretly reporting on him and his department to another Communist Party member in the office of the bank’s president, Jin Liqun. “It was a shadow reporting structure,” he said.

He said insiders at the bank had cautioned him early on about the Communist Party members working there. “Senior people warned me when I joined the bank, ‘Watch out for each of the party members. Be careful what you say around them. And don’t mess with them because they’ve got more power than other people do with the bank.’ ”

This proved to be true, Mr. Pickard said.

He said he found he had to win the approval of Communist Party apparatchiks at the bank to hire more staff, get a bigger budget and build a media studio. “To do business here and play politics inside of this bank, I would have to deal with party people and get them to consent to what it is I was trying to achieve,” he said. “None of which involves the the necessity of executive committee approval, or getting a board approval.”

The bank has also rejected this allegation. In its review, it said it had found no evidence of “parallel structures” of decision-making or influence at the institution. But it said the bank’s code of conduct does not preclude “informal networks of staff” on the basis of national origin, culture or other shared interests.

The bank’s review also took aim at Mr. Pickard, saying that while he “was recognized for his efforts and contributions towards improving internal messaging” at the bank, his tenure was “characterized by managerial shortcomings and interpersonal conflicts.”

Mr. Pickard disagrees. “The bank sees the destruction of my reputation as the easiest way to try and protect theirs,” he said. “It is important to note that I left on my own steam and was not pushed out.” He added that he more than doubled the bank’s media coverage, and that there were no communications staff departures during his time there.

Mr. Pickard said bank leadership and decision-making seemed too intertwined with that of the Chinese government and Beijing’s Belt and Road Initiative, which has been accused of ensnaring smaller nations in debt and then taking control of their infrastructure for Beijing’s own strategic purposes.

He pointed to the presence of Mr. Jin, the bank’s president, at the China-Central Asia Summit hosted by Chinese President Xi Jinping in May. The event was an effort by Beijing to cultivate more influence in a region that includes Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan.

“There’s President Jin at the same event, at which he signaled support with an uncomfortable proximity to the agenda of the PRC government,” Mr. Pickard said.

The bank rejects this allegation, too. In its review, it said it had found “no evidence that staff membership in any political party from any country has interfered with bank personnel’s discharge of official duties.”

Mr. Pickard said he stands by his recommendation that Canada quit the bank. Canada was one of the first Western countries to join the institution, putting up US$995-million for a 1-per-cent stake.

Since then, the bank has grown to more than 100 members. Germany, South Korea and Australia have all made major investments and taken stakes of between 3 and 5 per cent each. China remains the largest shareholder by far, with more than a quarter of all votes.

Mr. Pickard noted that Canada joined before relations with China soured, and before Beijing locked up two Canadians in retaliation for Ottawa arresting a Huawei executive on an extradition request from the U.S. This May, tensions increased when Ottawa expelled a Chinese diplomat for foreign interference.

“To me, the test of our membership is this: in light of China’s political interference, attacks on our country’s interests, and thuggish aggression against our citizens, would Canada now join the AIIB if it were being founded today?” Mr. Pickard asked.

“Not a chance!” he said.