After what was the only seriously contested World Bank presidential selection process in history, College President Jim Yong Kim was elected as the new World Bank president yesterday. While congratulations are certainly in order for our soon-to-be former president, there is ample room for debate over whether or not Kim is indeed the best choice for his new job. The Bank's decision to pass over Nigerian Finance Minister Ngozi Okonjo-Iweala was certainly not an apolitical decision. In an unfortunately astute commentary on the Bank's inner workings, Okonjo-Iweala herself commented, "You know this thing is not really being decided on merit."
If the selection of the World Bank's president were an apolitical process, Okonjo-Iweala would surely have triumphed over Kim. Endorsed by The Economist, the African Union and many former employees of the World Bank, Okonjo-Iweala went into the selection with a stellar track record of reducing national debt, gaining access to international credit markets and fighting corruption in the Nigerian government. Her candidacy was also supported by the Brazilian and South African governments. In a pointed jab at the U.S.-European duopoly on the Bank and the International Monetary Fund, South African Finance Minister Pravin Gordhan called for looking "beyond the verbiage of democracy" and asking in substantive terms whether the World Bank has met "the democratic test."
In a similar vein, former Colombian Finance Minister Jose Antonio Ocampo, who pulled out of the race on Friday, noted that the selection process for the World Bank presidency is a "political-oriented exercise" rather than an examination of candidate credentials. In this political atmosphere, Okonjo-Iweala had a slim chance of overcoming Kim's inherent advantage as the U.S. nominee, despite her qualifications and immense popularity with outside observers.
In many respects, Kim was also an impressive candidate. His roles as the co-founder of Partners in Health, the former director of the HIV/AIDS division at the World Health Organization and president of Dartmouth gave him a varied and accomplishment-studded resume. However, compared to Okonjo-Iweala, Kim had very little substantive experience specifically related to finance and development. Ultimately, it was politics specifically the United States calling in a favor from the European bloc after American support for the nomination of France's Christine Lagarde to head the IMF last year that clinched the World Bank presidency for Kim.
Kim's elevation to the Bank's helm over more qualified Okonjo-Iweala is only one symptom of the problematic nature of the U.S.-European stranglehold on the IMF and the World Bank. While this Western centrism may have been understandable in the aftermath of World War II when Asia, Africa and South America were struggling with postwar reconstruction, colonialism and internal sociopolitical disorder the contemporary emergence of strong, qualified leaders on all of these continents calls the West's stranglehold on the world's two most influential international economic institutions into question.
Moreover, the continued Western dominance over the World Bank and IMF presents unique problems relating to these organizations' developmental perspectives. Whereas Okonjo-Iweala would have brought a first-person perspective on development issues to the Bank's leadership, leaders such as Kim and Lagarde inevitably function with Western assumptions about governance and institutions. Unfortunately, Western style financial and government institutions often fail or underperform when transplanted into non-Western nations where normative standards of behavior around economic exchanges and the division of labor may be radically different.
This continued U.S.-European duopoly on the world's financial institutions is potentially unsustainable. Given that both the Asian and African economies are growing while the U.S. and the Eurozone are both continuing to struggle with the aftermath of their respective economic meltdowns, it is not inconceivable that Asia and possibly South America, depending on how Brazil performs in the coming years could overtake the United States or the Eurozone as the site of the world's primary economic power. If that day comes, it is impossible to envision that these developing countries, and China in particular, would be content in allowing Americans and Europeans to continue to control the world's primary financial institutions.
