Most people have now probably seen the news that Jim Yong Kim, the president of Dartmouth College in the US, has been elected as the next president of the World Bank. As a professor and former WB employee noted, the appointment is mostly political, and was never going to take merit into account.
“The Obama administration would almost certainly have withheld support for Lagarde’s appointment to the IMF if European nations had not agreed in advance to support whomever was Washington’s candidate for the World Bank.”
Even when I was still working at the Bank, we were told that a process was taking place to nominate eligible candidates from within the Bank. However, given that this has never yielded an actual Bank president, we knew that the whole process was only for show; the president always comes from outside the Bank. As a result, I think that the Bank will continue to stagnate and lose influence as a player in the international development sphere, and will likely become a lender of last resort rather than of first priority. While it is debatable whether the other two candidates would have done a better job than Kim, someone would have still been offended if one and not the other was elected.
Pro: Kim is foreign-born, and not Caucasian–definitely a change from Zoellick. He would also likely attract more investment from Asia than other candidates.
Con: Kim isn’t actually that different from Zoellick. He’s the president of a US university, and therefore works well in big bureaucracies and in the American/European business context.
Pro: Kim has a public health background and isn’t just going to look at financial returns.
Con: Kim doesn’t have an economics background… though arguably, the president never does economic analyses himself before making decisions anyway. Kim also likely would prioritize health issues over other problems (i.e. environment, agriculture/food security, infrastructure, etc.) even though these problems are often intertwined and can’t be approached in isolation (which is how the Bank continues to work.)
P.S. – Sorry for the long delay! I’ve been traveling and have sadly neglected the blog because I’ve been putting off putting up photos from Spain, Turkey, and France. Will get to it soon…
Imagine hordes of 35+ year olds wearing obscene paper hats they’d just stapled and colored with sharpies, wearing party hats with feathers, or wearing Halloween-esque hats ranging from rubber masks to cone-shaped witch hats. This was yesterday afternoon… and it was the town hall for our division at the World Bank.
Why did the vice president make us all do this? To laugh at us? (Probably.) Supposedly, it was also because we had cause for celebration: for the first time in a long, long time, we as a division no longer needed to defend our existence and were finally contributing something useful to the Bank. Sure, that’s definitely cause for celebration–but to think that it took this long? That’s a bit scary.
I wonder how many organizations have these identity crises. How much more efficient would they be if they were to coordinate, collaborate, merge, share resources–without trying to assert their individuality? This issue is coming up now in the form of whether to have a [new, better] version of the UNEP or [an improved, better-funded] UNEP or [the same, underfunded, under-respected] UNEP we currently have, because many countries want to see more action taken to protect and enhance the state of the global environment, and whatever we’re currently doing (hundreds, if not thousands, of organizations all trying to work on the same issues separately) isn’t working.
The bigger question I keep asking myself is in regards to development agencies in particular. Fifty years ago, they were mostly run by former colonial powers who felt morally bound to help the countries they often indirectly destroyed (i.e. the DRC). Ten years ago, they were still mostly run by the same developed countries, now with different organizational names, but still pursuing the global version of Congress: giving money in exchange for enforcing whatever they think is best. Today, the World Bank and other huge development/ lending agencies finally have competition (like the African Development Bank, among many others), driving them to become more efficient, effective, and innovative. The question is: are they too late in reforming themselves, and if not, what role can they play in the future global arena to stay useful and add value?
On a side note, I had lunch today with an alum who worked on a study, publicized in the Economist this week, about cash transfers to girls and young women in Malawi. The researchers randomly gave money to some of the young girls and their families and saw significant decreases in the rate of HIV/AIDS and herpes infections. While I’d need to read the study more carefully (and it doesn’t seem to be double-blind), the concept sounds like a promising conclusion! (And supports the fact that HIV infection is preventable given behavioral shifts.)
Today at work, I found out about the IEG (Independent Evaluation Group) at the World Bank, which [according to colleagues] consists of long-time WB employees who are nearing retirement (and therefore aren’t scared of losing their managers’ approval) and who are in charge of evaluating the impact of the World Bank Group’s projects. The non-WB-side (public) version of the IEG website looks far more glamorous than the side I see (and also seems to be missing some of the reports), but it’s still a great tool for figuring out the strengths and weaknesses of the WB and similar institutions at a much more nuanced level than how NGOs evaluate the Bank and its impacts.
Some interesting takeaways on the agriculture end:
- “IFC investments in agribusiness had above-average development outcome ratings in Latin America and the Caribbean and Europe and Central Asia but have been weak in Sub-Saharan Africa.”
- “When input support programs succeed bumper crops, the temporary surplus is not always exportable—for example, in Malawi and Zambia; storage facilities are also poor.” (this is from a workshop rather than a report)
- “Failure of policy makers to view research as a long-term investment.”
I must admit that I’m far less familiar with the OPIC’s operations than with those of the World Bank, IMF, and other development finance institutions. However, OPIC (the Overseas Private Investment Corporation) might arguably be doing a greater service to society than these more well-known agencies.
For one, it’s been able to finance itself since its creation in 1971, something that can’t be said for most bodies that insure private businesses in high-risk areas like the DRC, Sudan, and post-revolution Egypt. Secondly, the money is used to fund private ventures rather than languishing in government coffers and being syphoned off by bloated bureaucracies. Thirdly, the funding is being targeted (at least from what I can tell) towards high-risk (high-need) areas that would otherwise lack access to high amounts of capital or insurance–something that is very often not the case for other aid coming from the U.S. (which has historically been directed towards areas of national security interest, towards keeping incumbent dictators in power, and generally ignoring areas of greatest need.) Political insurance and general loans are far less “sexy” than humanitarian aid, but I’m thankful that at least OPIC is dedicated towards providing these services.
I definitely wish that OPIC had more staff dedicated to examining the social and environmental ramifications of their investments (like the $200 million that went towards coal-fired power plants in Indonesia in 1995 or the $60 million that was used to fund silver and tin mining for an American corporation in Bolivia in 2005)…
But there were investments that I did like:
- $1.75 million to expand a school campus in Ghana in 2005
- $6 million to insure construction equipment in Iraq in 2006
- $15 million to expand cellphone networks in Bangladesh in 2006 (telecom seems especially popular for OPIC investments)
- $3.9 million to build a cold storage warehouse in Georgia in 2006
- $24.5 million to insure the expansion of a flour mill in DRC in 2007 (though this seems like a rather high price tag…)
- $170,000 to finance a culinary school and restaurant in Nicaragua in 2007 (very cool!)