US names choice for World Bank head

12 Feb 19

Treasury official David Malpass has been named as the US’ nomination to lead the World Bank and has vowed to boost the bank’s lending powers and focus on economic growth.

Malpass, the undersecretary for international affairs at the US Treasury Department, speaking at the White House on Wednesday, said he would focus on reforms to increase the bank’s lending capacity by $13bn.

Malpass, who has been involved in US-China trade negotiations, said he would do this partly by increasing interest rates for higher income countries, such as China. The US official has previously called for the bank to halt lending to China, saying it is too wealthy to receive aid.

He said: “I’m very optimistic that we can achieve breakthroughs to create growth abroad that will help us combat extreme poverty and increase economic opportunities in the developing world.”

At a forum in 2017, Malpass singled out China as one of the biggest beneficiaries of the World Bank.  At the time he said China had “plenty of resources”.

If the candidate is approved by the banks executive board, Malpass would succeed Jim Yong-Kim, who announced at the start of the year that he would step down before his term was set to expire. He left the bank on 1 February.

Kim was first nominated by former US president Barack Obama in 2012.

The third sector has raised concern that the US exerts too much influence over the bank, which is based in Washington DC.

Historically, the US has nominated a candidate for the World Bank while European stakeholders put forward a name to lead the IMF.

Policy and advocacy manager at Eurodad, a European NGO umbrella group, María José Romero told PF International this “gentlemen’s agreement” where the allies work “behind closed doors” to ensure a US head for the Word Bank and a European for the IMF, “must end”.

She said: “The world cannot afford a prioritisation of national interests in multilateral institutions any longer.

“The World Bank is still the most influential public development bank in the world and needs a leader who supports transformative change, addresses growing inequality, climate change, and social justice challenges.”

She added that the bank “needs a president who truly supports the World Bank’s mandate to end extreme poverty”.

 

Eurodad’s Romero and Cecilia Gondard said the change in World Bank president presents an opportunity to appoint someone who will implement global development goals, in a blog last month. Read their article here.

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