Home Analysis World Bank: Okonjo-Iweala failed bid, lesson for Nigeria

World Bank: Okonjo-Iweala failed bid, lesson for Nigeria

by Business News Report

The World Bank Board has selected its next President, an American, for the next five years. The selection of Korean-born American health expert, Jim Yong Kim as its new president, has maintained Washington’s grip on the job and leaving developing countries questioning the selection process.
America and Europe are the principal shareholders of the World Bank which core mandate is to reduce poverty in its member-countries. The poor are mainly in Africa and other developing countries. The newly selected President was assisted to power with the support of Washington’s allies in Western Europe, Japan, Canada and some emerging market economies, including Russia, Mexico and South Korea.

These groups of nations hold about 70 per cent share in the World Bank. Boardroom politics anywhere in the world tilt towards the owners of the business. In most leading businesses in Nigeria, the Managing Director is usually not the best candidate but the one the owners feel will represent their interest best. America and Europe will not fund the World Bank and its affiliate and allow another country’s national to run them. The decision to zone the position of the President of World Bank to America and that of the IMF to continental Europe is to reflect this reality.
The Nigerian Senators who on hearing the result felt bad and condemned the selection process were being unrealistic. How many of them were elected based on merit? How many ministers did they screen based on merit? How many political appointees passed through the National Assembly based on merit? Today, the country Nigeria is at cross roads based on the zoning and ethnic arithmetic introduced into the Nigerian body politic.

Okonjo’s entering into the World Bank race has changed the equation of the selection process though she did not win. The Executive Directors following the new selection process agreed upon in 2011 for the first time in the bank’s history, yielded multiple nominees. This process included an open nomination where any national of the bank’s membership could be proposed by any Executive Director or Governor, publication of the names of the candidates, interviews of the candidates by the Executive Directors, and final selection of the President.

The President is Chair of the Boards of Directors of the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA). The President is also ex-officio Chair of the Boards of Directors of the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and the Administrative Council of the International Centre for Settlement of Investment Disputes (ICSID).
The board said: “We, the Executive Directors, wish to express our deep appreciation to all the nominees, Jim Yong Kim, José Antonio Ocampo and Ngozi Okonjo-Iweala. Their candidacies enriched the discussion of the role of the President and of the World Bank Group’s future direction. The final nominees received support from different member- countries, which reflected the high calibre of the candidates. This is a global testimonial for Okonjo-Iweala. That she is a Nigerian where many think nothing good can come from, is very heart warming.

The question is: What lesson has the Federal Government learnt from this? Economic diplomacy is all about national interest. America or Europe will not do anything except to further their economic interest. But Nigerian leaders do not think this way. When Africa Development Bank was set up, Nigeria had a larger shareholding. Today, Nigeria cannot decide the major policies of the bank. Nigeria cannot even lay claim to the leadership of the bank. It is the same story with the Afriexim Bank based in Cairo.

What about those fellow African countries that Nigeria has spent billions of dollars to help fight their cause? What result has the country to show for it? Instead, the nation receives all manners of insult from such countries.
The failure of competitors to unite behind Nigeria has sent a serious message to the Federal Government that its foreign policy is lacking global appeal. Russia which stands against most US decisions supported the US candidate. Mexico did the same as well as South Korea.

It is true that the bank’s approval of Kim “reflects how global governance continues to lag behind changing economic realities. Emerging-market economies are increasingly dominant in global trade, finance and output, but the advanced economies continue to maintain their positions of privilege at major international financial institutions. Nigeria must learn.

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