The Conflict Over the Asian Infrastructure Investment Bank Involving China, USA, and Japan

The conflict over the Asian Infrastructure Investment Bank (AIIB) involving China, the United States of America (USA), and Japan is analyzed within the paradigm of the Graph Model for Conflict Resolution to gain strategic insights and to predict the possible compromise resolutions. The conflict starts after China proposed in October 2013 the establishment of the AIIB. The USA and Japan opposed the founding of AIIB because they were concerned that China would use the bank to set its own economic agenda and policies. The hypergame analysis of this dispute, which takes into account misperceptions, shows that the option of implementing the Trans-Pacific Partnership (TPP) agreement by the USA would not result in the expected resolution as predicted by it. The insights gained by analyzing the conflict include that the TPP might be beneficial for the Chinese which is contrary to what was expected by the USA and Japan.