Board to rush decision by April 20: wonder who that favours?

On Friday the Bank’s board set out its version of what a good selection process for Zoellick’s successor would be.  They referenced the disappointing 2011 Board paper, and even took a few extra steps to make the process less transparent:

Nominations should be submitted by close of business on Friday, March 23, 2012

Just over four weeks.  Not as bad as the three weeks the IMF board allowed last year, but still very short.  Remember, the shorter the process, the more difficult it becomes for challengers to the US to muster the cross-country support needed to field a credible contender.

[Nominations] may be made by Executive Directors, or by Governors through their Executive Director.

This goes a step further than the Bank’s 2011 paper, which left nominations up to Governors.  Each of the Bank’s 187 member countries has a Governor, but there are only 25 Executive Directors, and most developing countries find themselves as one of many countries represented by a single Director. In many cases that Director may themselves be from a developed country – Cambodia is represented by New Zealand, Guyana by Canada, Kazakhstan by Switzerland,  and so on.

They also allow a four week selection period, with the new President to be announced at the Bank’s spring meetings, which begin April 20th. Again not much time to expose the candidates to a decent amount of public scrutiny.

But here’s the most damning point.  The list of qualifications for the job does not mention the need to know anything about developing countries, or anything about poverty reduction.

Meanwhile the chorus of voices pointing out that a US stitch up would undermine the credibility and effectiveness of the Bank – and hence be against the US national interest – is growing. Bessma Momani and Xenia Menziesis of the Centre for International Governance Innovation point out:

The entire financial and monetary system is looking to reserve-rich sovereign backers, like China, Brazil, Russia, and the Arab Gulf states. However, these countries are hesitating to throw their capital into these institutions, given how little power and clout they have inside the institution’s decision-making bodies. An institution that was more inclusive of views outside the G8 could do well to garner more emerging donor support. A move on leadership, even as a credible contest — if not a developing country appointment — would do well to instill confidence that these institutions are not just U.S.-EU instruments.

While Indian economist Jayati Ghosh makes another telling argument:

In the case of the international financial institutions, it has been argued that since developing and emerging markets are more likely to approach them for funds (indeed, the World Bank can only lend to developing countries) it is better to avoid conflicts of interest that may arise if the head of the institutions also comes from that country or region. That particular argument made by developed countries was blown apart last year, when Europeans insisted on having Lagarde at the IMF precisely because Europe was in such a huge economic mess that the services of the IMF would be required. Suddenly conflict of interest was no longer a problem; instead it even became a virtue, that of close knowledge and first-hand experience of the issue.

Surest way for the US to undermine the World Bank?  Push through its own candidate, with no opposition, and select someone who’s never worked in development…

2 thoughts on “Board to rush decision by April 20: wonder who that favours?

  1. The United States will not “push through” its own candidate, but it will be a well-qualified
    American who gets the job. However credible some emerging market candidates might be, and the speculators’ list so far isn’t encouraging, without the full support of the United States and the EU, the Bank’s ability to mobilize funds and use them well might be compromised.

    It would be better for the advocates for change to focus now on what the job entails, what the challenges are, and how candidates measured against those criteria would strengthen the Bank and its role in the world.

  2. Jeffrey Lehman, former president of Cornell and Dean of Michigan Law School would be an ideal choice to head the World Bank. As the founding Dean of the Peking University School of Law in Shenzhen China President Lehman was recently honored with the prestigious China Friendship Award. So he understands the importance of China in today’s world economy. President Lehman, who has been on the front lines of academic globalization, is a proven leader in large, complex organizations and has the intellectual gravitas to lead the World Bank through one of the most difficult times in the world’s economy since the bank was created. The Bank would be lucky to get him, if he has the interest.

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