This article seeks to make a contribution to the on-going
topic of debate concerning the appointment of a new candidate to be selected by
the World Bank directors for the role of president of the World Bank. It comes amid a call for reform of the selection
process of how Presidents of the bank is selected and the call for a global
policy shift of the way in which the bank currently operates. Barrack Obama has
fired the bow over the salvo by announcing his preference of candidate Jim Yong
Kim an American Health Professional this week in a high profile press
conference in the US this week. It is widely seen by international commentator
to be pandering to voters with an election year looming in the back ground. It
is widely believed that this move will shore up positive perceptions with voters that the President
is safeguarding the US international interest by maintaining the American
status quo. This writer broadly supports the candidacy of Nigeria’s current
Finance Minister Ngozi Okonjo-Iweala a previously managing director of the
World Bank on the basis of qualification and experience. However, it is broadly
anticipated that the American candidate Jim Yong Kim will get the job based on
an international sweet heart deal agreed by the US and Europe in 1944.
The World Bank was set up in 1944 with a charter to drive
post-World War II reconstruction. It evolved from the International Bank for
Reconstruction and Development, but its present day mandate is much wider:
worldwide poverty alleviation in conjunction with its affiliate, the
International Development Association. Since its inception, the World Bank has
lent and given grants and credits worth $400 billion. Its money is spent on
specific projects such as freeways and dams. In addittion the Bank employs economists and
policy people to tackle the causes of poverty in the poorest nations. Other
issues on the World Bank's agenda include the reduction of corruption, and the
promotion of education and health care in developing countries. The bank has a board of 24 executives. Five of
these come from its biggest donors (the US, Japan, Germany, France and
Britain), while the rest are chosen by its remaining member countries. The 19
executive directors represent groups of countries. For instance, Australia's
executive director also represents Cambodia, South Korea, Kiribati and other
Pacific nations. By convention, the US has always nominated the president of
the World Bank (the Europeans choose the head of the International Monetary
Fund under this handshake agreement). In recent years, developing nations have
been highly critical of this process because they say it means the bank becomes
the tool of developed countries, not those for whom it was set up to benefit
There are three candidates for the next president of the
World Bank. They are Jim Yong Kim from the US, Ngozi Okonjo-Iweala from Nigeria
and Jose Antonio Ocampo from Colombia. The Nigerian finance minister has been
endorsed by three African countries - South Africa, Angola and and Nigeria -
and is seen as a very serious candidate. However, Jim yong Kim has received the
powerful endorsement of US President Barak Obama and base on the history
selection process he is widely expected to get the top Job despite him having a
lack of banking and financial experience.
On record all three candidates come highly recommended and all
have core competence in international development issues that is required for
the job. Mrs Okonjo-Iweala, 57, was previously a managing director at the World
Bank, appointed by Robert Zoellick in October 2007, a role she held until last
year when she took up her government position. She is in her second stint as
finance minister, having also served under former Nigerian President Olusegun
Obasanjo .She studied at Harvard and earned a PhD in regional economics and
development from the Massachusetts Institute of Technology (MIT) .The married
mother-of-four has won many awards, including Time magazine's European Hero in
2004, Euro money Magazine Global Finance Minister of the Year in 2005, and the
Financial Times/The Banker African Finance Minister of the Year in 2005.
Jim young Kim the US
candidate was born in Seoul, he moved with his family to the US at the age of
five and grew up in Muscatine, Iowa. In high school, he was valedictorian and
president of his class, played quarterback for the football team and point
guard for the basketball team. He attended Brown University before going on to
Harvard where he earned his medical doctorate in 1991 and a PhD in anthropology
in 1993.He became president of Dartmouth College in 2009, where he made a
memorable appearance as a rapping spaceman, complete with white, studded
leather jacket, at a college talent show. Married to a fellow doctor, and with
two young sons, Dr Kim said he joined Dartmouth "to be more effective at
making the world a better place". He will hope to do the same at the World
Bank. Though a surprise choice, he is still the favourite for the top job,
given the US holds the most votes at the World Bank.
Mr Ocampo is best known as the former finance minister for
Colombia - though he has also held other posts in government, including
agriculture. He is well respected for a series of policies that helped his
nation avoid the worst of the financial crises that have struck Latin America
over the years. Currently, he is professor of professional practice in the
International and Public Affairs department of Columbia University in New York.
He has also been a visiting fellow at Oxford and Yale. Mr Ocampo has held a
number of positions in the United Nations, including as UN Under-Secretary
General for Economic and Social Affairs. He also took charge of the UN's
Economic Commission for Latin America and turned it into a regional development
powerhouse. He received his BA in economics and sociology from the University
of Notre Dame in 1972 and his PhD in economics from Yale University in 1976.
According to Deepak
Nayyar a well-known Indian professor and global economic commentator four
developing countries – “China, India, Brazil and South Africa (CIBS) - are
poised to become new southern engines of global economic growth with increasing
potential to provide prosperity to other developing countries. The economic
clout of these four countries will also create new realignments in the
international governance architecture providing policy space for developing
countries to pursue economic development. India, China, Brazil and South Africa
have a potential collective voice in the world of multilateral institutions and
rules and an enormous potential for exercising influence in these institutions
and rules which might shape policy space for countries that are late comers to development”.
These four CIBS countries- account for 40 % of the world's population and 60 %
of that of the developing countries. They account for about 10 % of the world’s
GDP and more than 40 % of that of the developing world. These countries
represent a beginning in the shift in the balance of economic power and also a
shift in the balance in political power and in my opinion deserve a bigger
voice in global governance and development issues.
Major critics of the
World Bank and IMF point to their failure since the Post Bretton Wood
Convention to alleviate poverty especially in the global south. The world has
more poor people than ever: 1.3 billion people -- over a fifth of the world's
population -- now live on less than $1 a day and a further 1.6 billion --
another quarter of the world's population -- survive on between one and two
dollars. According to the UNDP, financial volatility, job and income
insecurity, crime, threats to health, food insecurity, loss of cultural
diversity, community disintegration and environmental degradation have all
increased since the setup of World Bank and the IMF. The greatest losers from
all these trends are the poor in the global South. The predicament of these
countries is exploited to exert enormous control over their governments which
is used to ensure the bulk of public expenditure and economic activity is
channelled into debt repayments to Northern banks and investors. In the
process, once again, the poor are hit the hardest, as jobs are cut, health and
education budgets slashed, price supports removed, and food and natural
resources exported abroad.
One of the World
Bank's central roles is to ensure developing countries have the physical
infrastructure necessary to facilitate their integration into the global
economy. What it does by intentional default enable the exploitation of their
resources, cheap labour, and consumers by Northern multi-national corporations .The
word bank provides loans for the construction of roads, ports, mines,
hydroelectric dams, oil wells and pipelines, and coal-fired power stations,
mostly built, once again, by Northern corporations -- who received nearly
billions of dollars in direct loans and guarantees for this purpose from the
Bank's private sector collaborators. Revenues generated rarely reach the poor. Instead,
the poor are often displaced from their homes, suffer loss or damage to their
natural environment, and are placed in the front line of climatic
destabilisation that the Bank's support for fossil fuels is wholly unhelpful.
The World Bank and the IMF also provide loans to debt-ridden or near-bankrupt
developing countries in exchange for the introduction of structural adjustment
reforms that remove all constraints on Northern corporations seeking to
export/import raw materials, and invest or locate there. The financial difficulty
of these countries is exploited to exert enormous control over their
governments which is used to ensure the bulk of public expenditure and economic
activity is channelled into debt repayments to Northern banks and investors. In
the process, once again, the poor in recipient countries are hit the hardest.
As a result of austerity measures jobs are cut, health and education budgets
slashed, price supports removed, and food and natural resources exported
abroad.
Perhaps the most contentious issue of the World Bank has
been the curry favoured manner by which its president is selected.The former Presidents
of the Bank are mainly white, male and Americans, The current President Robert
B. Zoellick, is responsible for chairing the meetings of the Boards of
Directors and for overall management of the Bank. Traditionally, the Bank
President has always been a US citizen nominated by the United States, the
largest shareholder in the bank. The new nominee for the role of President of
the bank is subject to confirmation by the Board of Executive Directors, to
serve for a five-year, renewable term. The role of president and chairman of
the board of directors seem to me to be a conflict of interest. While most
World Bank presidents have had banking experience, some have not. The proposed
president Jim Young KIm being put forward by President Obama is an Asian
American with impressive experience on global Health issues and appears to be a
very charismatic fun loving person- but he lacks global financial management or
Banking experience. The Vice Presidents of the Bank are its principal managers,
in charge of regions, sectors, networks and functions. There are 25
Vice-Presidents, three Senior Vice Presidents and two Executive Vice
Presidents. She insists that she is, by far, the most qualified candidate,
having worked at the World Bank for decades, including a stint as its second in
command. She has adoring fans globally and has garnered support from opinion
leaders such as the editors of the Economist and PIMCO head Mohamed El-Erian.
The New York Times editorial board, which has called for a more open selection
process, urged the World Bank’s board to “take a serious look” at
Okonjo-Iweala. Most World Bank affiliates who have spoken out publicly on Okonjo-Iweala’s
behalf this includes 39 former staffers who wrote an open letter praising her
“deep experience in international and national issues of economic management” .
Among other things, she co-authored an influential report on how the bank
should operate in fragile states that have been racked by conflict (known as
“low-income states under stress”), where the bank’s government partners were
either dysfunctional or non-existent.
The details of Okonjo-Iweala’s
life story go a long way toward explaining why she generates such enthusiasm.
She was born in 1954, when Nigeria was still under British colonial control,
and reportedly learned English by reading books such as “Treasure Island.”
After the British left in 1960, her life grew tumultuous. In 1967, the south
eastern provinces of Nigeria, including Okonjo-Iweala’s home Delta State,
declared independence as the Republic of Biafra. A bloody, three-year civil war
ensued, leaving 1 million dead. Her father, a distinguished economist, joined
the Biafran army and her family subsisted through the war, she said, on one
meal a day. In a 2005 interview with the Guardian, Okonjo-Iweala recounted how,
when she was 15, she carried her malaria-stricken 3-year-old sister four miles
to find a doctor. The details of Okonjo-Iweala’s biography go a long way toward
explaining why she generates such enthusiasm. She was born in 1954, when
Nigeria was still under British colonial control, and reportedly learned
English by reading books such as “Treasure Island.”
After the British left in 1960, her life grew tumultuous. In
1967, the south eastern provinces of Nigeria, including Okonjo-Iweala’s home
Delta State, declared independence as the Republic of Biafra. A bloody, three-year
civil war ensued, leaving 1 million dead. Her father, a distinguished
economist, joined the Biafran army and her family subsisted through the war,
she said, on one meal a day. In a 2005 interview with the Guardian,
Okonjo-Iweala recounted how, when she was 15, she carried her malaria-stricken
3-year-old sister four miles to find a doctor. In an interview on Aljazeera
television Oknojo The details of Okonjo-Iweala’s biography go a long way toward
explaining why she generates such enthusiasm. She was born in 1954, when
Nigeria was still under British colonial control, and reportedly learned
English by reading books such as “Treasure Island.” After the British left in
1960, her life grew tumultuous. In 1967, the south eastern provinces of
Nigeria, including Okonjo-Iweala’s home Delta State, declared independence as
the Republic of Biafra. A bloody, three-year civil war ensued, leaving 1
million dead. Her father, a distinguished economist, joined the Biafran army
and her family subsisted through the war, she said, on one meal a day. In a
2005 interview with the Guardian, Okonjo-Iweala recounted how, when she was 15,
she carried her malaria-stricken 3-year-old sister four miles to find a doctor
.When she was 18, Okonjo-Iweala moved to the United States to study economics
at Harvard and MIT. She went on to join the World Bank in 1982, climbing
through the ranks by shifting between jobs and across regions: as an
agricultural economist focusing on Africa; country director for Mongolia,
Malaysia, and Cambodia; and deputy vice president for the Middle Eastern region.
Perhaps the most compelling reason to elect Ngozi (as she is affectionately
called) is her personal experience of poverty. During an interview recently on
Aljazeera television she boldly exclaimed:. “I know what it means to go to the
stream to fetch water. . . what it means when people are poor and don’t have
enough to eat. It’s not enough to say you know about poverty,” Okonjo-Iweala
said recently, explaining why she should lead the World Bank. “You have to live
it.” Those of us who live in the global south can identify with this statement.
While we in the global south are hopeful that the World bank
receive the reform that it so rightfully deserve we remain pessimistic and sceptic of its history
of neo-colonial and ultra conservative groundings that is skewed in favour of
the Global north and its multinational allies. One of the strongest criticisms
of the World Bank has been the way in which it is governed. While the World
Bank represents 186 countries, it is run by a small number of economically
powerful countries. These countries (which also provide most of the
institution's funding) choose the leadership and senior management of the World
Bank, and so their interests dominate the bank. The call goes further than
revamping the way in which candidates are rubberstamp and selected to ensure US
hegemony and the safeguard of an unfair washing consensus that drains the
economic life blood of developing countries who are clients of the World Bank.
The changes should extend to a client centric model as it stands now it donor- centric.
The selection of Ngozi Okonjo-Iweala
Nigeria’s current Finance Minister as a candidate who is eminently qualified
for the job by academic, work and life experience represents for the global
south a bigger and more influential voice in global governance. Critics like
former World bank Economist Joseph Stiglits rightfully argue that the so-called
free market reform policies which the World Bank currently Bank advocates are
often harmful to economic development if implemented badly, too quickly
("shock therapy"), in the wrong sequence or in weak, uncompetitive
economies. The candidacy of Okono-Iweala represents a fresh new start to a more
equitable way in which global finance is govern in a post Bretton Wood era
where the global tectonic spheres of economic influence is shifting southwards.
Donovan Reynolds is
Human Rights Activist and a London based independent writer of Jamaican decent with an interest in
human rights and International Development Issues. Readers are invited to
comment on this blog or to e-mail their
comments to dannygerm63@hotmail.co.uk
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