New York: The BRICS group of emerging market powerhouses — Brazil, Russia, India, China and South Africa — recently met on the sidelines of a G20 meeting in Mexico City and said the top World Bank job should be open to all countries. True, it’s time to end the custom of always picking an American to lead the World Bank. But will famed American economist Jeffrey Sachs mollify the emerging countries?
World Bank President Robert Zoellick is stepping down in June and he has decided not to seek a second term. Since the creation of the World Bank after the Second World War, Americans have always held the top job at the World Bank, part of the founding compact at Bretton Woods, which reserved the leadership of the International Monetary Fund (IMF), to a European.
Countries have to submit names for the World Bank top job by 23 March. US officials say they will put forward “a strong candidate.” It will be interesting to see if the BRICS band together to field a consensus candidate to scupper continued US dominance of the World Bank.
An online betting website in Ireland, called Paddy Power is taking bets and setting odds on who will become bank president. According to the weight of money, punters still expect an American to be the chief of the World Bank.
The Voice of America reported that early in the process, the betting favors Harvard economist and former presidential adviser Larry Summers. Other possibilities include Secretary of State Hillary Clinton, and Susan Rice, the US ambassador to the United Nations. The State Department, however, has said Clinton would not be taking the job.
Odds makers at Paddy Power, who correctly predicted Christine Lagarde of France would head the IMF, are now placing lower odds on Kemal Dervis, a former Turkish finance minister who has headed development efforts at the United Nations and was a key World Bank official involved in the developing world. Another veteran of the World Bank is Nigeria finance minister Ngozi Okonjo-Iweala, her nation’s former foreign minister.
Punters are also putting bets on Jeffrey Sachs who is campaigning to be the next president of the World Bank, saying it needs a development expert like himself rather than a politician or Wall Street banker. Stephen Foley of The Independent came out batting strongly for Sachs.
“Through his Earth Institute at Columbia University, and as an adviser to the United Nations on its Millennium Development Goals, Professor Sachs is indeed one of the foremost experts on tackling poverty in a globalised world – and he has calculated that he is sufficiently different from candidates past to mollify emerging countries despite being American,” Foley wrote in The Independent.
“I’ll sign on to a campaign in favour of Jeffrey Sachs. The World Bank is more than a taxpayer-funded aid agency; it is a political creature and it is a bank and there should be no shame in appointing a politician or a banker, from the US or elsewhere. But Jeffrey Sachs for chief economist of the World Bank – that might fly,” he added.
Over 37,000 people have signed a petition opposing Summers’ possible candidacy due to past comments denigrating women’s intellectual capacity in math and science. Critics of the World Bank’s environmental policies have also dug up an infamous memo Summers wrote while at the World Bank arguing that Africa was “underpolluted.”
“Everyone should welcome an actual campaign, and a merit-based selection, rather than just the US government choosing a political or Wall Street hack, which until now has been the process for selecting a World Bank president,” said Mark Weisbrot, co-director of the Center for Economic and Policy Research (CEPR).
“If Sachs were to get the job, he would be the first World Bank president with this kind of experience and knowledge of economic development,” added Weisbrot.
According to reports, a global alliance of 57 organisations is rooting for India’s rural development minister Jairam Ramesh. When the Hindustan Times asked Ramesh how he felt about being on a “rebel shortlist” along with former Brazilian president Luiz Inacio Lula Da Silva, Ramesh turned around and said “there was no one better” than Planning Commission deputy chairperson Montek Singh Ahluwalia to become the next World Bank chief.