Why Ngozi Okonjo-Iweala should run the World Bank
By Felix Salmon
Don’t tell the people at Euromoney, but I’ve liberated my article about Ngozi Okonjo-Iweala from September 2005, when the magazine gave her its genuinely prestigious Finance Minister of the Year award. It’s here, on my Tumblr, since the original is behind a paywall.
I think it’s important this story be much better known than it is, because it neatly encapsulates a lot of why Okonjo-Iweala would be a fantastic head of the World Bank. When she arrived as Nigerian finance minister in 2003, the country was what you might call an oil-poor kleptocracy, with virtually no credibility in the international community. Within two years, she had managed to use $12 billion of windfall oil profits to pay off $31 billion in bilateral debt, thereby not only massively improving the country’s debt dynamics, but also ensuring that money didn’t get stolen domestically.
It was an astonishing feat of negotiating prowess, not least because the Paris Club had never before allowed a country to buy back its debt below par, let alone 60% below par. Being able to pull it off involved Okonjo-Iweala leveraging her extremely strong credentials as an economist and finance minister (she has a PhD in regional economics and development from MIT); making full use of her high-powered contacts in the international community; and deftly navigating the labyrinthine bureaucracy surrounding World Bank classifications. Frankly, it’s impossible to imagine any other Nigerian being able to get this particular deal done.
Okonjo-Iweala’s qualifications for the job are well known; see the Economist, the FT, and also this Edward Luce column for good arguments as to why she would be a significantly better World Bank president than Jim Yong Kim. It’s worth reminding ourselves, in this context, of the Bank’s own description of the qualifications required by its president:
A proven track record of leadership;
Experience managing large organizations with international exposure, and a familiarity with the public sector;
Ability to articulate a clear vision of the Bank’s development mission;
A firm commitment to and appreciation for multilateral cooperation; and
Effective and diplomatic communication skills, impartiality and objectivity.
It’s hard to see how Kim can beat Okonjo-Iweala on any of these criteria. Meanwhile, Kim’s own FT op-ed, in which he tries to explain why he’s the right person for the job, is vapid in the extreme. “A more responsive World Bank must meet the challenges of the moment but also foresee those of the future. The World Bank serves all countries.”
Tim Geithner is lobbying for Kim, writing a letter to the Bank’s 187 governors saying that Kim “is committed to pursuing an agenda for the Bank that supports all the necessary components of development,” in a sign that the US doesn’t consider Kim a shoo-in for the job. And consummate Bank insider Lant Pritchett has laid out a credible, if admittedly improbable, series of possible events which could result in Okonjo-Iweala getting the job. “Everyone regretted letting the Americans ram through their choice of Paul Wolfowitz in 2005,” he writes. “The damaging consequences of that fiasco are still fresh in people’s minds.”
Kim is still the favorite for the job, just because he has the full and awesome power of US international diplomatic pressure behind him. But in any fair fight, Okonjo-Iweala would win. And if there are any signs at all that the European vote might not be completely in the bag, we might yet have a real contest on our hands here.