Asian Development Bank Set to Welcome Israel as New Member Despite Some Staff Concerns

Israel is set to become the newest member of the Asian Development Bank, which finances social and economic development projects across Asia—a region where many countries (and members of the ADB) have been outspoken in their criticism of Israel’s ongoing military campaign in Gaza, and some don’t even recognize Israel’s sovereignty.

Along the hallways of the ADB’s headquarters in Manila, there have been whispers for months about the plan to welcome the multilateral institution’s 69th member, which could be formalized as soon as the coming days, according to multiple sources.

Israel’s application process is “ongoing,” an ADB spokesperson tells TIME, and “a decision will be announced when the process is completed.”

“Israel completed the requirements for ADB membership at the beginning of September and is looking forward to officially joining the Bank,” Ohad Niepris, a spokesperson for Israel’s Ministry of Finance, told TIME on Thursday.

Four ADB employees who spoke to TIME on the condition of anonymity for fear of reprisal say that worries have been circulating among staff in recent months about Israel’s impending entry to the ADB, which was first approved in April 2022. 

Since then, the ADB has granted at least two extensions to Israel to meet the requirements necessary to become a member, according to interviews and public records reviewed by TIME, including an extension that came after Oct. 7, 2023, despite growing international concerns about Israel’s military campaign in Gaza, which has been repeatedly condemned by the United Nations and others for its high civilian death toll and alleged human rights abuses.

These deadline extensions were “requested and approved for technical reasons,” said Niepris, the Israeli spokesperson, adding that: “Such deadline extensions are a common practice in international organizations, particularly considering that these processes require legislative and internal government procedures which depend on multiple stakeholders.”

“A lot of us did not know about this last extension of Israel,” one ADB staff member tells TIME. “So that took us by a little bit of shock in thinking that Israel, whilst carrying out this unwarranted aggression against Palestinians, is being accepted as a member to the Asian Development Bank. I think it just comes across as a bit tactless, both the timing and the occasion upon which it’s happening.”

Israel has spent the last few years trying to join the ADB, as part of its plan to expand its footprint in Asia. It brings expertise in water management, which it has over the years shared with institutions like the World Bank and the Inter-American Development Bank, among other resources to the institution.

“It didn’t surprise me too much from a development perspective,” Jianzhi Zhao, associate professor of international development and public policy at the University of Exeter, tells TIME of Israel’s prospective ADB membership, describing it as a “win-win situation” for both Israel and the ADB.

Since 2017, representatives from Israel’s finance ministry have regularly attended the ADB’s annual meeting of the Board of Governors—the bank’s highest policy-making body—as observers; in 2019, Israel’s then-Finance Minister Moshe Kahlon met his French counterpart Bruno Le Maire in Bercy and returned with what he said was a pledge of support from France for Israel to join the ADB.

Those efforts came to fruition in 2022, when Israel was approved to join the ADB, according to a resolution by the Board of Governors, consisting of one representative from each member nation. 

The ADB did not respond to specific questions from TIME for this story but said in a statement that “new membership in the bank is decided in accordance with Article 3 of the Agreement Establishing the Asian Development Bank.” Referencing the same charter, Niepris, the Israeli spokesperson, said: “The ADB—like all MDBs [multilateral development banks]—is an apolitical institution as enshrined in its charter and as such bank activities are guided solely by economic considerations.”

To complete their ascension to the ADB, prospective members have to fulfill requirements, including implementing specific administrative steps and paying a subscription to shares of the capital stock of ADB.

For undisclosed reasons, Israel missed that initial deadline of Dec. 31, 2022. According to publicly available meeting minutes, in December 2022 Israel was granted a deadline extension by the ADB’s Board of Directors, 12 directors elected by the Governors and each representing several member countries.

In May 2023, the Israeli finance ministry announced that the country was “on its way to join” the ADB. But Israel apparently missed the deadline again: According to meeting minutes, the Board of Directors recorded its approval for Israel to be given a second deadline extension for its membership in December 2023—two months after Israel began its military campaign in Gaza in response to Hamas’ Oct. 7 attack.

It’s unclear to what extent the directors consult the governments of the members they represent—which include several countries that do not recognize Israel, such as Indonesia, Malaysia, Pakistan, Bangladesh, and Brunei. 

Malaysian Prime Minister Anwar Ibrahim met with Hamas leaders in May and criticized the “brutality of the Zionist regime.” Pakistan’s government has labeled Israeli Prime Minister Benjamin Netanyahu a “terrorist.” And Indonesia, the world’s most populous Muslim country and a longtime supporter of Palestinian rights, has also consistently condemned Israel’s actions in Gaza since Oct. 7. In these three countries alone, according to the ADB’s website, the bank has hundreds of projects that are either active or approved.

Sources tell TIME that it’s not uncommon for prospective members of multilateral banks to miss such deadlines. But while the first deadline extension of Israel might have been due to more administrative considerations, says Zhao, the second extension—granted after the explosion of the war in Gaza—cannot be interpreted without factoring “international reputation or international politics into the decision making.” 

“Because after all,” Zhao says, “multilateral development banks [are] a venue for multilateral diplomacy.” 

ADB, for its part, has maintained that it’s “avowedly apolitical” as an institution. Its employee code of conduct states that while “staff may exercise their political rights,” they must “refrain from participation in political activities which may interfere or conflict with their duties or their status as Staff of ADB.” They are also prohibited from being involved in the publication of documents that are related to “any national political questions.”

The bank has previously faced some criticism for not paying sufficient attention to human rights concerns in its operations. In May, as the ADB held its 57th Annual Meeting in Tbilisi, Georgia, a network of NGOs accused the bank of inadequate safeguards for the environmental and social impact of its projects, which activists have argued dovetail with shrinking civic spaces and suppression of communities across member states, from Georgia to Vietnam to Bangladesh.

However, the ADB has in the past cited human rights concerns for sanctioning countries. In 2021, it suspended sovereign project disbursements and new contracts in Myanmar after the country’s military seized power in a coup; that same year, it put on hold its regular assistance in Afghanistan when the Taliban took over the country; it also paused its work on a cross-border gas pipeline project that would have passed through Afghanistan, saying that it would wait until the Taliban-led authorities gained international recognition.

To some of the bank’s staff, it’s unclear why Israel’s actions over the past year have not triggered similar sanctions. Israeli settlements in Palestinian territories have been found by the International Court of Justice to be in violation of international law, while Netanyahu faces an arrest warrant from the International Criminal Court for alleged war crimes. 

“There’s obviously some inherent contradictions and hypocrisy in the move, because ADB does have strict policies on the countries it works with,” says an ADB employee of Israel being allowed to join. “Accepting a member that overtly violates international law seems a bit hypocritical of the institution.”

Niepris, the Israeli spokesperson, says that Israel “is a strong believer in the power of institutions to bring countries and people together in order to reach shared goals” and that it is “looking forward to working with all ADB members and staff to advance the Bank’s mandate to promote sustainable development and the eradication of extreme poverty across Asia and the Pacific.”

But while the impact of Israel’s addition to the ADB remains to be seen, some staff are already worried about what it will mean for their work at the bank and the bank’s broader reputation. 

Israel’s membership would “impact the way the ADB is perceived in some of the countries where we operate,” says the ADB employee. “This notion of ADB being more of an Asian institution tailored to the needs of countries in Asia and the Pacific gets a little bit tarnished by this decision.”