WORLD BANK PRESIDENCY: Can Dr Okonjo-Iweala make it?

on   /   in Special Report 12:22 am   /   Comments

BY OMOH GABRIEL Business Editor
ON Friday, the Board of Executive Directors of the World Bank drew the curtain on nominations into the position of World Bank President as Robert Zoellick plans to step down in June.

The management of the Multilateral Institution in a statement confirmed that three nominees will be considered for the position: They are Jim Yong Kim, Jose Antinio Ocampo and Dr. Mrs Ngozi Okonjo-Iweala.

Okonjo-Iweala

Mr. Jim Yong Kim is a US national and President of Dartmouth College, New Hampshire. The Korean-born Kim, 52, according to USA Today represents a break from the financiers and bureaucrats who have run the World Bank. That may be strength and a weakness, according to Mr. Uri Dadush, Director of international economics at the Carnegie Endowment for International Peace in Washington and a former World Bank Director of economic policy.

He said: “This is a very smart man and has many of the characteristics that you would look for in a World Bank president. He’s going to have a major challenge to overcome a characterisation as being too focused on the health and education agenda and to develop a deep understanding of the broader development agenda of the bank.” Dadush adds that Mr Kim lacks experience in boosting economic growth, a key part of the bank’s mission.

José Antonio Ocampo is a Colombian national and Professor at Columbia University, New York. Mr Jose Antonio Ocampo, 59, Colombian is a US-trained economist who has excellent credentials in academia, national politics and at the United Nations. He has held posts as Agriculture Minister, Planning Minister and Central Bank chairman in Colombia’s government. He is currently a professor at Columbia University in New York..

Dr Ngozi Okonjo-Iweala, a Nigerian and Coordinating Minister of the Economy and Minister of Finance, 57, is a respected economist and diplomat. This mother of four children has spent more than two decades in numerous positions at the World Bank.

Formal interviews

According to the World Bank statement short listing the three candidates the Executive Directors will conduct formal interviews of the three in Washington, D.C., during the following weeks, with the expectation of selecting the new President by consensus by the 2012 Spring Meetings. The IMF-World Bank meeting is slated for April 21- 23. At the Spring Meeting the official announcement of who among the three becomes President of the World Bank will be made.

Ordinarily, Dr. Okonjo-Iweala who until recently served as the Bank’s Managing Director would be expected by experience to pick up the job. But the President of the World Bank is made out of choice of convenience by the super powers. It is a known fact that when Europe has its citizen as Managing Director of the International Monetary Fund, the United States of America will produce the President of the World Bank.

This is so because the largest shareholdings in the two multilateral institutions are Europe and America. Last year, Europe filled the position of IMF managing director when Kraus Khan was disgraced out of office. Already Canada has backed U.S. President Barack Obama’s nominee to lead the World Bank, Canadian Finance Minister Jim Flaherty said on Friday.

“Mr. Kim is a distinguished figure in global health and development, noted for his innovative work fighting the spread of AIDS and tuberculosis in developing countries,” Flaherty said in a statement. He added: “We believe he is a strong candidate to lead the World Bank.”

While the US has nominated Kim, Angola, Nigeria and South Africa have endorsed the nomination of Ngozi Okonjo-Iweala, a respected economist and diplomat, as a candidate to take over the bank when Robert Zoellick steps down in June.

“The endorsement is in line with the belief that the appointment of the leadership of the World Bank and its sister institution, the International Monetary Fund, should be merit-based, open and transparent,” the three said in a statement. It was a rare example of unity among countries often at loggerheads as they strive for dominance on the continent. The United States has held the presidency since the bank’s inception after World War Two, and a European has always headed the IMF.

Brazil nominated former Colombian finance minister Jose Antonio Ocampo, but said it cannot do so without Colombia’s support. While Ocampo agreed to stand and Brazil was willing to nominate him, Colombian Finance Minister Juan Carlos Echeverry said on Thursday his country was instead focusing on a bid for the presidency of the International Labour Organization.

He said that effort had a greater chance of success than going for the World Bank job because Colombia already held the top post at the Inter-American Development Bank. Ocampo seems to be on his own as his home country does not even support his nomination let alone campaign for him. That leaves the contest between Nigeria’s candidate and that of the United States.

Russia, a member of the Brazil, Russia, India and China (BRICs) caucus of large emerging market economies, has refrained from publicly backing a non-U.S. candidate and instead called for a greater role for them in top management at international financial institutions.

Although the World Bank board would like to reach a consensus, Washington retains the largest single voting share and could expect the support of European nations and Japan, the bank’s second-largest voting member. The rise of emerging economies such as China, India and Brazil has put pressure on the United States and Europe to throw open the selection process for both the bank and the IMF.

Last year, all of the bank’s 187 member countries agreed on a transparent, merit-based process to select a president. If that is followed the chances are that Dr. Ngozi Okonjo-Iweala would be selected on merit.

But if the United States insists on voting by shareholding volume, as the single largest share holder, it will vote for its own candidate and would expects it allies in Europe and Japan to support its candidate. If that happens, the US as usual will have its way and Yong Kim becomes the next World Bank President. The question is how much of diplomacy is the Federal Government of Nigeria putting into this.

This is more of politics and diplomacy than mere qualification and experience. If the Nigerian Government push far enough it can get Russia, China, Brazil, India and other African countries to support its candidate. Besides, this is the first time a woman will be coming forward for the top World Bank job. The US is gender sensitive, it may just concede for Dr. Okonjo-Iweala to be the next World Bank President.

The deadline for nominations was 6 p.m. Washington time (2200 GMT) on Friday. The World Bank board of member countries will then shortlist three candidates and finalize its choice by the time of the IMF and World Bank semi-annual meetings on April 21. The new head of the bank will take over at a time when the euro zone debt crisis is slowing the global economic recovery, undercutting demand in emerging and developing markets. That person will have to decide how best to deploy resources in a budget-cutting environment in which large bank shareholders such as the United States are demanding results-based development, more transparency and greater efforts to tackle corruption. Nancy Birdsall, president of the Center for Global Development in Washington, said earlier the nomination of a credible candidate such as Okonjo-Iweala “upped the ante for the U.S. to have a really strong candidate.” “It is a sign that we’re living in a world where the geopolitical landscape is shifting and the U.S. can’t do things by itself,” she said.

The United States faces an unprecedented challenge to its grip on the World Bank presidency, with emerging African economies nominating a candidate to set up the first contested bid for the top job at the global development lender. Angola, Nigeria and South Africa endorsed the nomination of Nigerian Finance Minister Ngozi Okonjo-Iweala, a respected economist and diplomat, as a candidate to take over the bank when Robert Zoellick steps down in June.

 

    Print       Email