A New World {Bank} Order? (REPORT)

(Video, The White House)

(HN, March, 23, 2012) - And then there were two.  When US President Obama nominated his World Bank candidate Jim Yong Kim today just hours before the deadline, the choice was a surprise.  

(The World Bank Logo) The deadline for nominations to replace the current president, Robert Zoellick, is 18:00 (6:00P) Washington time (22:00 GMT) tonight.

"I am nominating Dr. Kim to be the next president of the World Bank", said Obama.  "I can think of no one more able to help families, communities, and entire nations break out of poverty, which is the stated goal of the World Bank," he said.

Obama pointed to Dr. Kim's international experience in his statement "He has worked in rural villages and squatter settlements just as he has worked in the halls of power and privilege."

Dr. Kim is a US academic who currently heads Dartmouth College and is by career, a doctor and former director of the HIV/Aids department at the World Health Organization. Dr. Kim also co-founded the health organization `Partners in Health' in 1987 along with Dr. Paul Farmer; and has been lauded on innovation lists from Time to Fast Company.

Paul Farmer, chair of the Department of Global Health at Harvard University, praised the nomination.  "It is time for a development professional to lead the world's leading development agency," he said.

The pick for one of the world's leading development banks could have also gone to another well-known American who openly campaigned for the job, global economist Jeffrey Sachs.

(PHOTO: Dr. Jeffrey Sachs/The Earth Institute) Earth Institute founder, UN advisor, emerging market government consultant Jeffrey Sachs announced his own bid for the World Bank presidency last Fall saying, "The inside process has produced 11 out of 11 politically-orientated appointments.  Not one of them has been a development professional. It has been seven bankers, three defense or military officials, and one congressman."

But following Dr. Kim's nomination, Sachs announced his withdrawal from the race tweeting,   "Jim Kim is a superb nominee for WB. I support him 100%. I thank all who supported me and know they'll be very pleased with today's news".

Sachs had support from several developing countries of the G20 including Costa Rica, Kenya, Haiti, Jordan, Malaysia, East Timor, Bhutan, Guatemala and Chile who openly backed his bid.

Dr. Kim, 52, had not been among the names rumored to be under consideration by President Obama, which included former White House adviser Larry Summers, Pepsi head Indra Nooyi,  UN ambassador Susan Rice, economist Laura Tyson, Senator John Kerry and US Secretary of State Hillary Clinton.

"This is one of the most critical institutions fighting poverty and providing assistance to developing countries in the world today," Dr Kim said in a letter to students at his university.

AFRICA'S CHOICE

The nomination has set up a two person race for the Bank's top spot as three African countries - Angola, Nigeria and South Africa have pledged their support to Mrs. Okonjo-Iweala, the Nigerian Finance minister and a respected economist, diplomat and former World Bank managing director, as their World Bank choice.

(PHOTO: Mrs. Okonjo-Iweala/The Nation) Of the competition Mrs. Okonjo-Iweala has said: "I consider the World Bank a very important institution for the world, and particularly for developing countries deserving of the best leadership, so I look forward to a contest of very strong candidates.  And am I confident? Absolutely."

It was also believed that Brazil was set to nominate former Colombian finance minister, Jose Antonio Ocampo, but on Thursday, Colombia's current finance minister, Juan Carlos Echeverry, said the country was instead focused on a bid for the presidency of the International Labor Organization which it felt it could win.  Mr. Ocampo had agreed to stand for the World Bank post, but Brazil, needed Colombia's support to proceed.  It is unclear if they will nominate someone else by tonight's deadline.

HOW DOES THE WORLD BANK CHOOSE ITS LEADERS?

A US citizen has led the Bank since it was founded in 1944, but developing nations say it is time for change.  The World Bank presidency is chosen by the organization's board, which has 25 representatives of the Bank's 187 member countries.  Some, like the US and the UK have their own seats, like the UN Security Council. Others are grouped by constituencies.

The goal is to choose a new president by consensus, but a simple majority will do. Votes in the World Bank - and in the IMF too - are weighted by financial contribution.  The US accounts for 16% of the vote; EU countries have 29% and Japan as the next largest voting partner.

The World Bank has 13,000 staff in more than 100 countries, and loan funding is expected to reach $26 billion this year.

G8 ECONOMIC DOMINANCE

In recent years the emerging markets of the world have loudly voiced their opinion that the 'monopoly' of G8 dominance over the world's economic system must be changed to incorporate the fastest growing, largest populations of the world such as Asia, Africa and Latin America into the decision making process.

The United States will now face its first unprecedented challenge to its hold on the World Bank presidency with at least one candidate in opposition; setting up the first contested bid for the top job at the global development lender.

The rise of emerging economies such as China, India, Russia and Brazil has put pressure on the United States and Europe to throw open the selection process for both the Bank and the IMF tho these giants have quietly accepted the situation. Mexico, to its credit as this year’s chair of the G20 did not hesitate to make a bid for the IMF leadership last year.

(PHOTO: Christine Lagarde/Wikipedia) The World Bank and the International Monetary Fund were created at the conference at Bretton Woods, New Hampshire in 1944 as a way to standardize trade between nations after the devastation of the Great Depression and World War II.  An unspoken agreement has  traditionally seen a US national head the World Bank and a European run the IMF - currently France's Christine Lagarde.

And it seems the `Geographic Gap' (tm) countries (*HUM research) have support in their arguments for more inclusion.  Recently three former chief economists of the World Bank - Francois Bourguignon, Nicholas Stern and Joseph Stiglitz wrote an editorial saying about the World Bank selection process, "To say it is merit-based, and to choose an American repeatedly, shows scant respect to the citizens of other countries". 

Other critics - from academics to non-governmental organizations - have long argued that the World Bank is ineffectual and even damaging to developing countries because of its emphasis on free market economics. 

The current president, Robert Zoellick, is to step down from his role at the institution when his five-year term comes to an end on 30 June.

(PHOTO: Paul Wolfowitz/Wikipedia) Mr. Zoellick, 58, was nominated for the role in 2007 by then US President George W. Bush, following an employee relationship scandal between then World Bank President Paul Wolfowitz who resigned when it was discovered he had negotiated preferential compensation treatment  for his girlfriend Shaha Riza with the US State Department, shortly after he became bank president in 2005.

The deadline for nominations is 6 p.m. Washington time (2200 GMT). Then the World Bank board of member countries will shortlist the names of two or three candidates and finalize its choice by the time of IMF and World Bank semi-annual meetings on April 21.

--- HUMNEWS, (c) 2012

RELATED:  Kenya, End U.S. Monopoly Over World Bank (Perspective)

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G20 foreign ministers meet in Mexico; say `World is failing' (NEWS)

(PHOTO: Mexican Foreign Minister Patricia Espinosa Cantellano speaks during the opening of the G20 Foreign Ministers Informal Meeting in Los Cabos, Baja California Sur state, Mexico, 2.19/Xinhua, Shi Sisi)LOS CABOS, Mexico -- Foreign ministers of the Group of 20 (G20) on Sunday convened in Los Cabos, a resort town in northwestern Mexico, to discuss important issues including global governance, food safety, climate change and green growth.

Mexican Foreign Minister Patricia Espinosa, host of the meeting, said that frank and open dialogue would be held among G20 foreign ministers and officials from other invited countries at the two-day meeting from Sunday to Monday.

Mexico, which holds the G20 presidency this year, planned the meeting to "stimulate ideas" to promote the changes the world needs, said Espinosa.  "There are many important issues that affect the lives of billions of people across the world, on which the international community is failing to make any discernible progress," she said.

She called for progress to be made on issues such as eradicating famine and illiteracy, promoting green growth and sustainable development, and enhancing the rule of law.

The Mexican official, however, said the meeting, given its informal color, would not lead to any official documents.

"At this stage any results arising from these sessions will be mere recommendations for policy coherence among our countries and we do not intend to develop guidelines or formal documents to negotiate at the G20 Summit," she said.

According to the minister, the meeting have four major topics, namely the multilateral trade system, current global challenges, green growth and human development.

The meeting brought together 10 foreign ministers of G20 member economies, including U.S. Secretary of State Hillary Clinton, German Foreign Minister Guido Westerwelle, European Union foreign policy chief Catherine Ashton and Australian Foreign Minister Kevin Rudd. The Chinese delegation is led by Assistant Foreign Minister Ma Zhaoxu. Mexico also invited representatives from non-G20 economies and international organizations to participate in the meeting.

Los Cabos, the coastal resort where the G20 Summit will take place in June, has adopted strict measures to beef up security. More police and soldiers have been deployed at the airports and along the major roads to maintain order and check the vehicles.

--- this article first appeared on Cam11

Related:

Mexican Presidency of the G20

Mexico will chair the G20 in 2012 and host the Leaders’ Summit in June of the same year. By assuming the annual Presidency of the G20, as the second emerging country to do so at the Leaders’ level, and the first in Latin America, Mexico confirms its role as a responsible and constructive actor, both regionally and globally.

Mexico is firmly committed to achieving a successful Summit in regards to the agreements reached and their positive impact on the world economy. The Mexican Presidency will seek to follow up the agreements reached previously and will also work to make important contributions to these and other issues of the agenda of the G20. Moreover, Mexico will promote an active and engaged participation of non-members, international organizations, think tanks and the private sector in order to make the G20 dialogue as inclusive, open and transparent as possible.

With this goal in mind, Mexico has established the following priorities:

1. Economic stabilization and structural reforms as foundations for growth and employment.

2. Strengthening the financial system and fostering financial inclusion to promote economic growth.

3. Improving the international financial architecture in an interconnected world.

4. Enhancing food security and addressing commodity price volatility..

5. Promoting sustainable development, green growth and the fight against climate change.

Leadership From G20 Critically Important Right Now (PERSPECTIVE)

By Bill Gates

Leadership from the G20 is critically important right now. The global economic situation is as fragile as it has been at any time in the past 50 years. As leaders of the G20, you face a difficult challenge: How do you resolve the immediate crisis while continuing to make smart investments in long-term growth and improved living conditions?

During my lifetime, innovations in business, science, and technology have energized the global market economy in unprecedented ways. The world economy is 500 percent bigger than in 1960. Whole groups of countries that had been at the margins have become key drivers of growth. Their success is widely viewed as a miracle.

This progress has benefited everyone, not just the richest. You can see progress in the rising Gross Domestic Product (GDP) of many countries around the world. You can also see it in falling poverty rates and other quality-of-life indicators captured in the Millennium Development Goals (MDGs), established by world leaders in 2000 and agreed to by all G20 nations.

In the past 50 years, a billion people were saved from starvation by advances in agriculture. Health has improved in stunning ways, thanks to innovations like vaccines. In 1960, 20 million children under the age of 5 died. In 2010, fewer than 8 million children under 5 died. The world population more than doubled during this time, which means the rate of death has been cut by over 80 percent. Aid generosity has played an important role in these successes.

Despite the current economic crisis, I am optimistic that we can build on the generosity and innovations that worked in the past. The group of countries able to contribute resources to development is larger than ever before. The number of people who can spur innovations is much greater than in the past. For these reasons, I am convinced we can create a new era in development.

In this report I talk about the long-term investments and partnerships I believe will keep us on the path of economic growth and increasing equity.

I begin the report by describing the paramount importance of innovation. Key innovations like new seeds and vaccines—and new ways to deliver them to the poorest—can multiply the impact of the resources we’re already devoting to development. We’ve made a big difference, but we can improve the basic tools of development by making them cheaper, easier to use, and more efficient—or by inventing wholly new tools.

One of the newest resources for development—and potentially one of the most transformative—is rapidly growing countries’ capacity for innovation. Countries like Brazil, China, India, and Mexico are in a great position to work closely with poor countries because they have recent experience in reducing poverty, as well as enormous technical capabilities. This unique combination gives them both the insights and the skills to create breakthrough tools for development. I am particularly excited about the possibility of "triangular partnerships" among rapidly growing countries, traditional donors, and poor countries, because they exploit the comparative advantages of many different countries.

Ultimately, developing countries’ domestic resources will be the largest source of funds for development. To maximize the impact of these resources, poor countries must raise more revenue; spend it on priorities like agriculture and health, which many have committed to do; and, following the lead of G20 countries that pioneered impact evaluation, measure the cost-effectiveness of their programs. One important way G20 countries can help poor countries raise more revenue is by passing legally binding transparency requirements for mining and oil companies listed on their stock exchanges, to ensure that natural resources are well-managed.

Meanwhile, traditional donors must take steps to meet their aid commitments and spend their aid strategically. If the countries that have made promises stick to them, it will generate an additional $80 billion annually starting in 2015. Over the years, Official Development Assistance (ODA) has had a huge impact, and it will continue to play a pivotal role in development, alongside all the new resources I write about. Well-designed aid reduces poverty right now, and accelerates poor countries’ progress toward the moment when they will no longer need it. There’s a lot of pressure on aid budgets given economic conditions, but aid is a very small part of government expenditures. The world will not balance its books by cutting back on aid, but it will do irreparable damage to global stability, to the growth potential of the global economy, and to the livelihoods of millions of the poorest people. In the report, I include some tax proposals G20 countries should consider that could help them meet their aid commitments and eventually expand them.

Finally, I talk about ways to get the private sector much more involved in development. As a businessman, I believe the free market fuels growth. Unfortunately, the market often fails to address the needs of the poorest, but there are relatively simple things we can do to encourage private investment in development. For example, G20 countries could facilitate an infrastructure fund—with sovereign wealth funds as the backbone—that generates both development impact and financial returns. I also make recommendations about tapping into the goodwill of diaspora communities by issuing bonds, lowering the cost of remittances, and creating pull mechanisms to incentivize private investments in development.

When you put all this together, I believe you begin to get a picture of why the G20 Summit is such an important place to be having a conversation about development. We can cast aside our old categories of aid, as distinct from private investment, as distinct from domestic spending. The G20 countries can pull all these levers at once, giving the world a more comprehensive and cooperative approach to improving the lives of the poor than we’ve ever had before.

The above is the Introduction to a report presented to world leaders at the G20 summit in Cannes, France, Bill Gates outlined recommendations to encourage innovation and new partnerships that increase the value and delivery of development aid. Click here for the full presentation.

Zuma Draws Line in Sand: Africa Not at G20 With "Cap in Hand"

(HN, June 26, 2010) – CAPE TOWN, South Africa - Striking an almost heady tone, South African President Jacob Zuma said today that Africa intends to assert an aggressive stance at the G20 Summit and no longer make demands with "cap in hand."

Addressing the opening of a global business forum in the South African city of Cape Town via satellite, Zuma said: "Our voices will be heard on a number of issues...We seek equal partnership for meaningful growth and development in forums such as the G20 and G8.”

He said this included pressing for reforms of the international financial system and for the opening of markets.

Zuma said top on the agenda at the G20 - which takes place today and tomorrow in Ontario, Canada - will be measures needed to sustain recovery and the required reforms. "We will underline the urgency of considering the voice of the developing world in the creation and implementation of new financial standards and rules," Zuma said, adding that the African continent represents a market of almost one-billion, of which 20 million are in South Africa.

He added: "We are not here in Canada - cap in hand - to ask for some of these things."

The South African president's assertive voice is emblematic of the "New Africa" - a growing cadre of democratically elected leaders from the continent not satisfied to keep silent and let the developed world make most of the decisions that impact on them.

Zuma reminded his audience that sub-Saharan Africa is now the third fastest growing region in the world - after China and India. Fuelling the growth is demand for more consumer goods, sound economic policies and "improved political conditions."

Zuma wasted no time touting the positive qualities of the country he leads - citing world class infrastructure, improved tourism and sporting assets and solving bottlenecks. He said the international media's coverage during the ongoing World Cup has been incredibly positive.

In boasting about the benefits the World Cup will bring to South Africa, he made no mention of his neighbours - some of which, such as Lesotho - complain about being sidelined by the world's largest sporting event.

--- Reporting by HUMNEWS’ Michael Bociurkiw, at the Fortune/TIME/CNN Global Forum in Cape Town, South Africa