Old King Coal

Mr. Obama's contentious domestic coal policies are for the US to sort out however, the U.S./Chinese climate "agreement" signed late last year – in which the Chinese conceded nothing, is more an indication of Obama's desperation to make climate his legacy issue than it is about helping developing nations.

The AIIB initiative and its boost to coal-fired funding, leaves the U.S. president and the EU/UN looking even more isolated on the geopolitical scene. More importantly, the AIIB has the potential to eliminate the " development funding leverage" exerted on developing nations by the UNFCCC to comply with their de-carbonization policies and appears to set developing nations on a collision course with the UN climate talks in Paris scheduled for December, 2015.

It seems highly unlikely that any members of the AIIB would on the one hand, gain much needed access to coal friendly international finance whilst also signing up for a replacement Kyoto and binding limits to their emissions?

It appears that Pakistan will benefit from the announcement that "Chinese President Xi Jinping is set to unveil a $46 billion infrastructure spending plan in Pakistan that is a centerpiece of Beijing's ambitions to open new trade and transport routes across Asia and challenge the U.S. as the dominant regional power. The largest part of the project would provide electricity to energy-starved Pakistan, based mostly on building new coal-fired power plants". -Jeremy Page, The Wall Street Journal, 19 Aril 2015

"Energy projects with Chinese support would generate a total of 16,500MW electricity, adding the work on 10,400 MW projects would be completed by 2018 in the first phase, while projects of 60,00MW will be completed in the second phase".

In Thar, the coal deposit infrastructure rejected by the World Bank, "10 coal-based power plants alone will be installed on commercial basis which will generate up to 6,600MW electricity from coal". Business Recorder, 18 April 2015

Australia as a coal exporter will increasingly have to compete and find new markets as the AIIB signatories move to power their development with coal. Whilst the EU in general and Germany in particular are busy killing off even their coal and gas power generation fleets and blunting their industrial capacity.

These announcements are of major significance and warrant more and better analysis in Australia. They potentially change the dynamics of our energy policies, export markets, industrial competitiveness, foreign policy and our role in the Asian community.