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It’s Back To Work For The Finance Minister

In the last one month, Nigeria and Nigerians have found themselves in an unusual position: one of their own was proclaimed as the best candidate for a job of considerable international resources and influence. What started fairly innocuously soon became a full-on campaign for Ngozi Okonjo-Iweala’s presidency of the World Bank, with several endorsements from respected opinion leaders coming her way. The Financial Times, the Economist, the Guardian, Washington Post, as well as a number of highly respected development economists backed her for the job ahead of the US nominee, Jim Yong Kim, who is a physician.

Today, the World Bank voted, and Kim became President-in-waiting, and will take over from Robert Zoellick when the latter steps down on June 30. In between, however, what has happened is a true global conversation challenging the automatic right of the US and EU to produce the World Bank and IMF Presidents respectively. The victory of Kim is similar to making Babatunde Osotimehin the head of the Central Bank. At the basic level, it is a hard sell irrespective of his sterling achievements.

Even though Okonjo-Iweala was widely acknowledged to be the best (wo)man for the job, many were rightly skeptical she would emerge. First, the traditional splitting of the leadership of the World Bank and IMF between the US and EU was extremely difficult to break, not just because of the antecedents but because the EU, which remains in dire economic health, needs IMF assistance to get back on its feet, which is directly linked to increased US funding. As a result, there was no doubt they would fall in line, irrespective of whatever arguments regarding meritocracy were put forward. Self-interest above all. Secondly, in an election year, the US administration was never going to take any chances in seeing its nominee for the position lose, which would be interpreted back home as a foreign policy failure. Meritocracy be damned.

Losing out in the race is by no means a failure for the Finance Minister. Rather, it gives her a moral victory that will linger for a while and challenges the way the developed world decides to prosecute development in other countries, and brought the process for selection of a World Bank President under intense scrutiny. It could also push the formation of a BRICS bank higher on the agenda of the world’s leading emerging markets, which currently account for much of global growth, and are frustrated at not having a bigger say in the selection. Indeed that may be the only option, because for as long as the US continues to provide much of the money for the running of the World Bank, it is unlikely they will allow anyone other than one of their own to lead it.

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