WORLD BANK PRESIDENCY AND CRISIS OF LEGITIMACY
Since their founding in the Bretton Woods suburb of Washington DC towards the end of the Second World War in 1944, the leaderships of the World Bank and the IMF (the International Monetary Fund) have been a duopoly between the US and Western Europe. Perhaps as the biggest contributor to the World Bank, the US has appointed all its past 11 presidents.
And, in a trade off, Europe has also always produced the president of the sister IMF. It is this carve-up that the rest of the world finds objectionable and has been flexing muscles to change. Thus, a groundswell of clamour has grown for the reform and restructuring of the Bretton Woods institutions with especial regard to their top leadership selection process.
The calls for a change, which has been gathering momentum over the past few years, appears to have reached a crescendo with the impending appointment of the new head of the World Bank. The filling of the premier post of the World Bank for the next five years beginning from July 1, 2012 has pitched the emerging and developing countries of the world against the entrenched conservatism of the Western World in the leadership of the twin Bretton Woods institutions.
The world is changing in fast and profound ways with the emerging BRICS economies - Brazil, Russia, India, China and South Africa - and the developing countries increasingly contributing more to the growth of the global economy. Many of the abounding instances that attest to this include the fact that China's is now the second largest economy in the world and she is today the third biggest contributor to the World Bank itself. Brazil's economy has outstripped Britain's, while Nigeria's economy has been growing at over 6% annually in the past decade. Indeed, 6 out of the 10 fastest growing economies in the world today are in Africa. Therefore, it has become outdated and indeed untenable, in view of the present economic realities, for the United States to insist on a perpetual claim to the Bank's top post while the EU maintains a lock on the IMF helm.
As the power of the emerging markets - the BRICS countries - waxed, the world could no longer ignore the strident calls for an open and transparent process that would augur for a genuine merit-based competition in the selection of the heads of the two institutions. Hence, the G20 (a grouping of the world's leading twenty economies comprising both developed and emerging economies) reached an agreement for the reform of the leadership and governance of the Bretton Woods institutions. One of the highlights of the agreed reform agenda was the commitment to an open and competitive process in the appointment of the leadership of the two international financial institutions.
Aside from the democratization this shift of paradigm will epitomize; two other imperatives make it both necessary and needful that Bretton Woods should look towards the emerging and developing economies for both leadership and inspiration. Firstly, the emerging and developing countries live and breathe development and daily battle developmental challenges. Therefore, there is an undeniable accumulation of practical experience and expertise in the design and implementation of proactive developmental solutions in these countries.
Secondly, the BRICS and many developing countries of OPEC are making increasingly more contributions to the funding kitty of the Bank and the Fund. In furtherance of the G20 commitments, which paved the way for the first ever global call for nominations to replace the outgoing World Bank president, Robbert Zoellick; the 11members of the Bank's board from the emerging and developing countries put forward two excellent candidates in the persons of our own Ngozi Okonjo-Iweala and Jose Antonio Ocampo of Colombia. The US nominated Jim Yong Kim, a Korean-American to complete the three-person shortlist.
The duo of Okonjo-Iweala and Ocampo are considered better credentialed for the job having served at different times as ministers with multiple portfolios dealing with poverty reduction and socio-economic development in their countries and distinguished themselves in top positions in multilateral organizations, to wit, the World Bank and the UN respectively. They both understand finance and economics as well as the challenges of underdevelopment and hands on savvy in tackling them. Kim's experience and expertise on the other hand are considered mono-sectoral and limited to his work with Partners in Heath (PIH), an NGO he co-founded, in Haiti, Peru and Russia; and the directorship of WHO's (World Health Organization) department in charge of initiatives against the global HIV/AIDS scourge. One reason why analysts believe that he will be better suited to serve in the health issues focused WHO.
In interviewing and voting on the three shortlisted candidates for the position, the Bank's 25- member governing board and the West may do well to remember the admonitions of the two immediate past presidents of the Bank. James D. wolfensohn, the 10th President of the World Bank in the annual World Bank meeting of 2000 in Prague remarked, inter alia that: 'we have learned that development cannot be imposed from above, it must be home grown and home owned.
Ours must be a partnership to build a new internationalism to match a global economy. In a similar vein, the 11th World Bank President, the out-going Robert B. zoellick, speaking on the 'Democratisation of Development Economics' in Georgetown University in the US in September 2010 re-affirmed the zeitgeist when he stated that 'a new multi-polar world requires a new multi-polar knowledge… the first world must open itself to competition in ideas and experience'.
Okonjo-Iweala stands tallest for the post. Having risen to the position of No. 2 in a meritocratic World Bank bureaucracy as an African and a woman confirms that she is a competent and quintessential professional. She is a grounded developmental economist and technocrat as well as a charismatic diplomat much admired around the world from Africa, through Asia to the developed world for her knowledge, expertise, vision and passion to make the World Bank 'a nimble and more effective agency for tackling poverty and facilitating development around the world'. Let the World Bank presidency be given to the best woman. And, Ngozi Okonjo-Iweala is it.
Nwagbara is a visiting member of The Sun Editorial Board.