The World Bank must break with the past and choose a leader in touch with the needs of borrowers in poorer countries, campaigners have demanded, as the US races to replace outgoing president David Malpass.
“We can’t afford another Malpass,” said Andrew Nazdin, director of Glasgow Climate Action, an umbrella campaign group. “We need a World Bank and global financial system that is accountable to the people it serves.”
A shortlist of candidates for the bank presidency — including Samantha Power, head of the US Agency for International Development, Rockefeller Foundation president and also former US Aid boss Rajiv Shah and World Trade Organization director-general Ngozi Okonjo-Iweala — has emerged since Malpass announced on Wednesday that he would step down a year before his term ends. All the contenders have US citizenship.
Nazdin said there were “glimmers” of the right candidate in the shortlist but that he would “love those making the decision to think bigger and better than we have had before”.
The US is the largest shareholder in the World Bank and has led the countries pressing for reform. Many want changes that would unlock more funding, enabling the institution to step up its lending programmes to tackle global poverty and climate change. A Group of 20 working group said last year that the world’s biggest multilateral lenders, including the World Bank, could boost their lending capacity by $500bn to $1tn by making modest changes to capital adequacy frameworks.
The bank has also been criticised for being too slow to deliver finance. The average time taken to disburse funds is 465 days, although this is often because of delays beyond the bank’s control and has fallen in recent years.
The implicit agreement between the world’s richest economies that the two main Bretton Woods institutions — the IMF and World Bank — are run by a European and a US citizen respectively has also come under fire.
Amy Dodd, policy director for development economics at the ONE Campaign against extreme poverty and preventable disease, said: “It is a problem that a small number of countries, in practice, control our global financial institution.”
Dodd added: “We are not giving countries a more equal say in the running of the World Bank, which has huge importance for their own development.”
Dodd said that, in addition to lending more money, the bank should back transnational initiatives to address climate change and poverty. It usually lends directly to individual countries.
Dodd’s boss, Gayle Smith, is also in the running to replace Malpass. Another candidate is Mafalda Duarte, chief executive officer of the $11bn Climate Investment Funds.
Janet Yellen, Treasury Secretary, said the US expected the bank’s board to run a “transparent, merit-based and swift” selection process and confirmed the US would put forward a candidate.
Pressure on Malpass, who was nominated for the job by former US president Donald Trump, had risen after he refused to say whether he believed in human-caused climate change at a conference last September. He later said he had been misunderstood.