Okonjo-Iweala interviews for Bank
By Erin Landau, The Dartmouth Staff
Published on Tuesday, April 10, 2012
After years of battling corruption in Nigeria’s Finance Ministry, Ngozi Okonjo-Iweala, who has been nominated for the World Bank presidency against College President Jim Yong Kim, was interviewed by the Bank’s board on Monday in an effort to determine the most qualified candidate for the position.
Vying for a position that has traditionally gone to Americans, Okonjo-Iweala’s “considerable experience” in banking and dealing first-hand with developing countries puts her in a position to challenge Kim’s advantage, according to economics professor Marjorie Rose.
“Her two stints as Nigeria’s Minister of Finance also demonstrate that she understands how to successfully balance the financial and economic challenges of a developing country,” Rose said.
However, Uri Dadush, former World Bank director of international trade, expects the executive directors of the Bank to vote according to instructions from their governments, he said in an interview with The Dartmouth.
“While I would like to think this is going to be an open, transparent, competitive process based on qualifications, I believe in practice there is going to be a lot of political pressure exercised behind the scenes and that countries will vote due to considerations from political alliances,” Dadush said. “The central political alliance will be between the U.S. and the U.K., thus they will likely be able to count on the vote of most European chairs.”
A Harvard University-educated economist, Okonjo-Iweala not only served as Nigeria’s first female Minister of Finance but also as managing director of the World Bank and vice president of the World Bank Group, according to Colin Bradford, senior fellow in the global economy and development division of the Brookings Institution and former chief economist at the U.S. Agency for International Development.
“Okonjo-Iweala’s advantage would be not only financial and economic, but that she’s also quite adroit at understanding the relationship between public policy and the private sector, both in business in developing countries, and foreign investment from advanced to developing countries,” Bradford said.
In a Monday opinion piece in the Financial Times, Okonjo-Iweala outlined her qualifications for the World Bank presidency. In the piece, she discussed her childhood in Nigeria, where she experienced poverty firsthand.
“I lived through the Nigerian Civil War in my formative years, where I observed how violence could set back years of economic development,” Okonjo-Iweala wrote. “My thinking has also been shaped by the past 30 years, working in almost every region of the world on thorny issues of development.”
In her op-ed, Okonjo-Iweala said her number one priority as president would be creating jobs, which requires “steady, inclusive economic growth based on prudent macroeconomic policies and development of key sectors of the economy, fitting the specific conditions of each country.”
Okonjo-Iweala has also led many talks through Technology, Energy and Design, notably her 2007 keynote address on aid versus trade as a part of TEDGlobal’s talk “Africa: The Next Chapter.”
“Today, the European Union is busy transferring aid,” Okonjo-Iweala said in her TED speech. “If they can build infrastructure in Spain, roads, highways, why do they refuse to use the same aid to build the same infrastructure in our countries?”
For her efforts to bring openness, transparency and accountability to government financing and operations, Okonjo-Iweala was selected as a Time Magazine “Hero of the Year” in 2004 and received the Euromarket Forum Award for Vision and Courage in 2003.
In an interview with CNN, Okonjo-Iweala said that she would make the Bank a faster and nimbler organization, able to respond swiftly to problems in developing countries. The Bank should also focus on promoting growth in developing nations to create jobs, especially for young people, she said.
“This is not theory you are dealing with, it’s fact, it’s experience, it’s real world,” Okonjo-Iweala said in the interview. “How do we make a policy decision that will help millions of poor people today?”
In a letter to the Bank’s board, 39 former World Bank managers, including former Chief Economist Francois Bourguignon, endorsed Okonjo-Iweala, citing her familiarity with the Bank and global finance, Bloomberg News reported.
Dadush signed the letter endorsing Okonjo-Iweala for the presidency and he described her as the “most qualified candidate running for the position.” He said that during her tenure as Finance Minister, Okonjo-Iweala developed wide experience in different regions of the world, including Asia.
The Economist also endorsed Okonjo-Iweala as the best candidate for the presidency, saying that her breadth of experience in government, economics, finance and development are qualifications that former Colombian Finance Minister Jose Antonio Ocampo and Kim do not share. Okonjo-Iweala has also been endorsed by the Financial Times, the African Union, Nigerian President Goodluck Jonathan and Mohamed El-Erian, CEO and co-CIO of Pacific Investment Management Company, a global investment management firm and one of the world’s largest bond investors.
The World Bank is a “multilateral institution” that relies heavily on budgetary contributions from advanced countries like the United States and Europe, according to Rose. The United States, the bank’s largest shareholder, has traditionally picked the bank’s president, and the United States, Europe and Japan have 54 percent of the votes.
“Strong and sustained support by the U.S. government is critical to the World Bank’s financial survival,” Rose said. “Having a U.S. citizen at the helm will help bolster internal support for the institution within the U.S. government, which will be critical in the Bank’s planned capital expansion.”
Robert Zoellick, who became the 11th president of the World Bank in July 2007, will step down in June. The other candidates, Ocampo and Kim, will be interviewed on Tuesday and Wednesday, respectively.