By: Michael Asiedu (Staff Writer)
On April 5, 2019, David R. Malpass was approved by the executive directors of the World Bank to be the World Bank President. Malpass was a former senior U.S. Treasury Department official and U.S. President Donald Trump’s nominee to head the World Bank. He began his five-year term on April 9, 2019.
His appointment follows a 73-year tradition of an American running the affairs of the world’s largest development lender. This tradition emanates from an informal deal that the U.S. struck with its European allies post-World War II which gave Europeans the right to select a leader for the International Monetary Fund (IMF) in exchange.
At the time, the U.S. held that the World Bank should be presided over by an American as the U.S. was the sole capital surplus nation and given that the World Bank’s lending capabilities and funds are heavily dependent on its financial markets.
Former U.S. Secretary of State Fred Vinson argued that since it was unpragmatic to appoint U.S. nationals to lead both the World Bank and the IMF, the latter should go to the Europeans. This arrangement still remains even though growth in world capital markets has ensured that the World Bank is no longer solely reliant on U.S. capital markets.
However, it is a disservice to developing countries when a candidate who is perceived as questionable is selected to lead the World Bank. For instance, prior to his appointment, Malpass was largely regarded as unsuitable for the position. Jesse Griffiths, Head of Development Strategy and Finance at the Overseas Development Institute, argued that Malpass did not meet the Bank’s selection criteria. The Bank’s criteria include someone with a proven track record of leadership and experience in managing large public organisations with extensive international exposure.
A non-negotiable characteristic is that the individual possesses an in-depth comprehension of development issue as the World Bank only operates in developing countries. Additionally, a presidential candidate should be a huge enthusiast of multilateralism. These are both qualities that Malpass lacks.
In addition to Malpass being a huge skeptic of multilateral institutions, he is a conservative supporter of pro-U.S. economic growth, attributes which are contrary to the World Bank’s current economic agenda. His professional track record also demonstrates that he is a novice to the international development arena with little interaction with the developing world.
To rectify this outright monopoly, the selection process must shift towards a merit-based system. For instance, in terms of the Bank’s presidency selection, the U.S. has the largest share of votes with 15.98 percent, followed by Japan with 6.8 percent. China has 4.45 percent, Germany has 4.03 percent and the United Kingdom and France each possess 3.78 percent. This means the U.S. only needs to persuade nine or 10 countries to support any nominee it puts forth. This feat is easily achieved due to the informal post-World War II deal between the U.S. and its European allies, which has meant that historically Western European countries have supported the U.S.
A merit-based system will nullify this share of votes and institute proper competition for the top job. It will ensure that someone with a track record of global engagement and a passion for international development in some of the world’s poorest regions is chosen. In fact, it is the sort of leadership that developing countries require–someone who understands the unique dynamics of the development challenges they face.
A merit-based system will again level the playing field for countries in Europe, Africa, Asia, or other places to all put forward suitable candidates without regard for nationality–the best candidate in this case wins. Evidence of a merit- based system is currently reflected in the leadership selection processes of some other international organisations.
To illustrate, the assumption that the Eastern European bloc will get to choose the next Secretary-General of the UN in 2016 failed. Instead, after competitive rounds of campaigning and public voting, the General Assembly elected former Portuguese Prime Minister António Guterres, a candidate from Western Europe.
Another well-suited candidate, António Vitorino, was also chosen on merit in comparison to Ken Isaacs, Trump’s nominee to lead the International Organization for Migration (IOM), which also happened to be the first time a non-American had been chosen for the post since 1951. Thus, precedents have already been set.
In conclusion, in order to safeguard the World Bank’s operations and interests of developing countries in general, it is high time the consistent scenario in which an American is always nominated for the World Bank top job ceases. The Bank has reached a crucial point in its existence, hence it is time to use a merit-based and transparent system in selection of its presidents.