Category Archives: Take Action

World Bank president selection: ‘Gentleman’s agreement’ alive and well

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After the unexpected resignation of World Bank President Jim Yong Kim in January, the selection of his successor was subject to considerable scrutiny. Over 150 civil society organisations, academics and other individuals calledon the Board to live up to its commitment following Kim’s departure to an open, transparent and merit-based process. The call was echoed by the demands outlined in a January letter by the Bank’s own staff association. These demands are not new and resonate with long-standing calls to end the so-called ‘gentleman’s agreement’, which ensures that the IMF managing director is a European and the World Bank president a US national. They also reflect the calls made as far back as 2012, not by civil society activists or ‘disgruntled’ governments from the Global South, but by senior Bank staff. Former Chief Economist Joseph Stiglitz and Senior Vice-Presidents François Bourguignon and Nicholas Stern argued in a 2012 Financial Times article that the process is “not only hypocritical, it also destroys the trust and spirit of collaboration needed to manage the profound problems facing the world.”

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What does civil society want now that Malpass will be World Bank President?

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Cartoon, Smiley, Questions, PuzzleIn the past, civil society has been quite forceful about what they want in terms of process for selecting a World Bank President, basically it can be summed up as anyone but an American. That battle has been lost.

But now that it is certain that David Malpass will be World Bank president, perhaps NGOs and other civil society groups should think what stance they want to take to the Malpass Presidency. Civil society organisations probably have many different opinions of this – reflecting back on the welcoming reception some of the health-oriented groups gave to the nomination of Kim in 2012. CSOs have always been a diverse bunch.

How will World Bank watchers respond? Will they turn back to 1990s style anti-World Bank opposition at all costs? Will some of them continue trying to work with power rather than against it? Will there be efforts to influence the politics at the board to reduce the harm of the Malpass presidency? Or perhaps they will step back and watch, as they hope the World Bank crumbles into irrelevance under inept and politicised leadership? Continue reading →

The future direction: where does Malpass stand?

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There are big questions in development finance that the new World Bank President will need to answer. There is a big question about what direction David Malpass will take at the World Bank. Will civil society be pushing the Bank to answer these questions in a positive way? Here are just a few things on the agenda:

  1. How should the World Bank engage with the rise of new creditors and funders in the system – particularly Chinese banks?
  2. Without being a “self-service shop” for investors – what is the vision for the Bank’s role vis-a-vis private finance? It’s easy to say don’t privatize health and education sectors, but what about beyond those easy platitudes? What is the role for the IFC that accords with a sensible vision for a multilateral bank that is now supposed to be supporting sustainable development, rather than what an aid agency should do?
  3. Given worries about debt crises building in developing countries, how should the next World Bank president manage lending to countries increasingly heading towards debt distress but in desperate need of investments to hit their Sustainable Development Goal (SDG) targets?
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Open letter from civil society to the WBG Board: Make commitment to climate action a prerequisite for next WBG Prez

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NB: The below text is from a letter submitted by 31 civil society organisations to the World Bank’s Board of Executive Directors on 14 March. A PDF version of this letter is available here.

Dear World Bank Group Executive Directors,

We write to call upon you to prioritise the Bank’s role in combating climate change in the selection of the next World Bank Group president.

We feel strongly that the appointment of the World Bank’s next president will greatly affect, positively or negatively, the Bank’s implementation of its commitments to take effective climate action, and to bring its lending and technical support into alignment with the Paris Climate Agreement.

As you well know, climate change poses an existential threat to societies around the world. A landmark IPCC report released in 2018 lays bare the scale of the challenge: Global CO2 emissions must be reduced by 45 per cent by 2030 compared to 2010 levels to keep global average temperature rise at 1.5°C compared to preindustrial levels.

As the climate crisis continues to bite, many of the Bank’s borrower countries will be among the most severely impacted. The Bank’s own research shows that 100 million people could be pushed back into poverty by 2030 due to climate change impacts. In short, climate change is a direct challenge to the Bank’s organizational mission of eliminating extreme poverty and promoting shared prosperity.

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Open letter to the World Bank Group Board of Executive Directors

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Appointment of the new World Bank Group President

The selection of the new World Bank president takes place amid a crisis of multilateralism reflected in the ascent of anti-establishment and nationalist parties and increased trade tensions. These arise from persistent challenges to the world economy ranging from the growing inequality crisis, the increasing importance of finance, financial markets, and financial institutions in the economy, a looming debt crisis and increased corporate capture that is resulting in the erosion of states’ sovereignty and their ability to meet their human rights obligations. These trends are exacerbated by the quickly evolving climate change crisis, which threatens the livelihoods of the poorest around the globe.

The World Bank requires a leader able and willing to critically assess the role the Bank can play in challenging the failed model that has led us here. The next president must ensure the institution leads by example and uses its privileged position to articulate the need for radical change. More than ever the World Bank requires a president who is qualified to lead what is still the world’s principal public development bank.

It is therefore imperative that the selection process results in the appointment of the best candidate, chosen from a wide-ranging pool of people with the background and experience required.

One thing is certain, at a time when the legitimacy of international institutions is increasingly under attack, reliance on the previous process, where the US and its European allies work behind closed doors to ensure the selection of a US World Bank president in exchange for the European leadership of the IMF will only further erode confidence in the multilateral system. It is of vital importance therefore that the next president has the support of the majority of low and middle-income countries, to which World Bank lending is restricted. Continue reading →