Jim Yong Kim Named New World Bank Chief
The World Bank announced on Monday that Jim Yong Kim will be the organisation's next president, following a heated race that saw developing countries challenging the US for the Washington-based international financial institution's top post.
The election of Kim, Washington's candidate for the position, is not surprising. The head of the World Bank has traditionally been from the US, while the chief of the Bank's sister institution, the International Monetary Fund, is usually a European, thanks to an informal agreement between the two sides when the institutions were established after the Second World War.
However, this marks the first time in the bank's history that it has considered multiple candidates for its top position, and Kim will face the immediate challenge of reconciling differences caused by a bitter election.
The two other candidates were José Antonio Ocampo, Colombia's former finance minister, and Nigerian finance minister Ngozi Okonjo-Iweala; Ocampo had dropped out of the race on Friday, backing Okonjo-Iweala's candidacy.
Already Kim's main challenger has called the transparency and democratic nature of the voting process into question, while at the same time congratulating Kim.
"With regard to the selection process, it is clear to me that we need to make it more open, transparent and merit-based. We need to make sure that we do not contribute to a democratic deficit in global governance," Okonjo-Iweala posted on Monday.
Kim is unique in comparison to previous World Bank chiefs, being a doctor and anthropologist by training, not a banker, politician, or US foreign policymaker, the traditional professions of his predecessors.
He is also a global health expert who has worked at the World Health Organization and founded Partners in Health. In both capacities Kim has focused on heath programmes in poor countries.
"[Kim's] rigorous, science-based drive for results will be invaluable for the World Bank Group as it modernises to better serve client countries in overcoming poverty," said outgoing World Bank chief Robert Zoellick in a statement. Kim will replace Zoellick at the organisation in July.
BRICS pushing for reform
The power dynamics in global lending and financial support for developing countries have changed drastically in recent years, with emerging economies being credited as major drivers of economic growth following the crisis. Many of these emerging economies also have deep cash reserves and have already become leading investors and lenders to poorer developing economies.
While emerging economies were granted an increased relative voting share in 2010 at the World Bank, the BRICS countries - Brazil, Russia, India, and China - have repeatedly called for a major overhaul of the Bretton Woods institutions, a goal that they reiterated at their annual summit in New Delhi last month (see Bridges Weekly, 4 April 2012).
At the summit, BRICS leaders urged the World Bank leadership to commit to reform that "truly reflects the vision of all its members, including the governance structure that reflects current economic and political reality."
"The nature of the Bank must shift from an institution that essentially mediates North-South co-operation to an institution that promotes equal partnership with all countries as a way to deal with development issues and to overcome an outdated donor - recipient dichotomy," they continued.
The BRICS had been hopeful that a strong candidate from the developing world could challenge the US' hold on the Bank's top spot. Okonjo-Iwela had been nominated in a rare show of unity between the sub-Saharan rivals South Africa, Nigeria, and Angola.
However, the developing economies could not forge similar agreement to present a unified backing for one developing country candidate. It was only days before the vote that Ocampo dropped out of the race and put his support behind Okonjo-Iweala.
In the end, sources close to the voting said that China and India backed Kim in executive board deliberations on Monday, according to the New York Times.
However, BRICS countries are likely to support the new president regardless of whoever wins, Rogério Studart, executive director of the World Bank representing Brazil, commented to the Financial Times prior to the decision's announcement, as "the institution is more important."
Meanwhile, calls for the bank's institutional reform continue. "The bank could become irrelevant if it doesn't reform," said Otive Igbuzor of the African Centre for Leadership, Strategy and Development in an interview with the LA Times. "Emerging economies are growing very quickly and in 50 years time they'll be bigger than the developed economies."
ICTSD reporting; "BRIC Nations to Back World Bank Choice, Brazil Says," BLOOMBERG, 13 April 2012; "S. Africa pushing for more World Bank, IMF reform," BUSINESSWEEK, 16 April 2012; "World Bank job favourite ‘lacks expertise,' FINANCIAL TIMES, 29 March 2012; "World Bank picks Kim as new head," FINANCIAL TIMES, 16 April 2012; "Africa calls for World Bank reform after Nigerian denied top post," LOS ANGELES TIMES, 17 April 2012; "U.S. Candidate Is Chosen to Lead the World Bank," THE NEW YORK TIMES, 16 April, 2012.