Washington-26 Jun 07. Robert B. Zoellick, a seasoned player in international financial and diplomatic circles, won the unanimous approval of the World Bank’s board to become its next president.
A World Bank press release said, “The Executive Directors of the International Bank for Reconstruction and Development (the “Bank”) met today to select a new President of the Bank. In doing so, the Executive Directors expressed appreciation to Mr. Paul Wolfowitz as departing President of the World Bank Group.
“The Executive Directors are confident that will address the challenges facing the Bank, including a successful 15th replenishment of IDA, development of a long-term strategy for the Bank Group and issues related to corporate governance.”
Zoellick, 53, brings to the World Bank years of experience in foreign and economic policy under three Republican presidents, starting with Ronald Reagan.
As World Bank chief, he will have his work cut out for him. He will need to regain trust, rebuild credibility and mend frayed relations inside the institution and with its member countries worldwide. He will also need to persuade countries to contribute nearly US$ 30 billion over the next few years to fund a bank program that provides interest-free loans to the world’s poorest countries.
Some bank officials fear, and others hope, that the governance and anticorruption effort will fade. All indications are, however, that his successor, Robert B. Zoellick, will not let that happen.
“Corruption is a cancer that steals from the poor, eats away at governance and moral fiber and destroys trust,” Mr. Zoellick said. “The challenge is how best to clean corruption out. That’s what the World Bank must diagnose, determine and execute in concert with developing and developed countries.”
How much corruption exists is a matter of conjecture. No one disputes that in its 60-year existence, the bank did not do much about corruption until a decade ago, when James D. Wolfensohn, who was then the bank president, made combating it a priority.
The department of institutional integrity was established only seven years ago. It has barred 148 individuals and 190 companies from doing business with the bank. In an institution that employs 10,000 workers, 74 employees have been cited for cases of fraud and corruption.
In recent years, the bank has gone beyond specific cases and started investigations into pervasive corruption problems in Vietnam, Indonesia, Kenya, Cambodia and India.
In Vietnam, the bank’s integrity division decided to investigate pervasive corruption problems after a scandal last year involving charges of theft, bribery and nepotism in a road-building project. Vietnamese prosecutors charged that road-building money lined the pockets of officials and also went to pay for gambling and prostitutes.
Mr. Zoellick has been working to keep lines of communications open with the board. He met with the board for four hours Wednesday to discuss key issues, including challenges of development, the bank’s governance and leadership, and future strategic directions. He plans to reach out to the staff, as well, he said.
By tradition, the World Bank has been run by an American. The Bush administration made clear that it wanted to keep that decades-old practice intact throughout the Wolfowitz debacle.
The United States is the bank’s largest shareholder and its biggest financial contributor.