The US has expressed concern over Britain’s effort to become a founding member of a Chinese-backed bank that could rival the likes of the World Bank.
The UK is the first big Western economy to apply for membership of the Asian Infrastructure Investment Bank (AIIB).
The AIIB will fund Asian energy, transport and infrastructure projects.
However, the US has raised questions over the bank’s commitment to international standards on governance.
In a statement, UK Chancellor George Osborne said the UK had “actively promoted closer political and economic engagement with the Asia-Pacific region” and that joining the AIIB at the founding stage would create “an unrivalled opportunity for the UK and Asia to invest and grow together”.
The hope is that investment in the bank will give British companies an opportunity to invest in the world’s fastest growing markets.
But the US sees the Chinese effort as a ploy to dilute US control of the banking system, and has persuaded regional allies such as Australia, South Korea and Japan to stay out of the bank.
In response to the move, US National Security Council spokesman Patrick Ventrell said: “We believe any new multilateral institution should incorporate the high standards of the World Bank and the regional development banks.”
“Based on many discussions, we have concerns about whether the AIIB will meet these high standards, particularly related to governance, and environmental and social safeguards,” he added.