IT IS extremely rare for Britain to take a foreign-policy stance at odds with that of its closest and most important ally, America. It is perhaps unprecedented for it to do so by siding, in a contentious issue of global financial governance, with the superpower’s emerging rival, China. Yet that, in effect, is how America seems to interpret Britain’s plans, announced on March 12th, to join China’s new Asian Infrastructure Investment Bank (AIIB) as a founding shareholder. China, naturally, is chuffed. Most other observers are flummoxed.

The AIIB is one of a number of new institutions launched by China, apparently in frustration at the failure of the existing international financial order to adapt quickly enough to accommodate its astonishing rise. Efforts to reform the International Monetary Fund are stalled in the United States Congress. America retains its traditional grip on the management of the World Bank. The Asian Development Bank remains based in Manila, but it is mostly run by Japanese bureaucrats.

So it is perhaps understandable that China, flush with the world’s biggest foreign-exchange reserves and anxious to convert them into “soft power”, is building an alternative system. Its plans do not just include the AIIB, but also a New Development Bank launched with its “BRICS” partners—Brazil, Russia, India and South Africa—and a Silk Road development fund to boost “connectivity” with its neighbours. And, in the security sphere, there is the Shanghai Co-operation Organisation that links it with Russia and Central Asia.