PREVIEW
Former Mastercard chief executive Ajay Banga's commitment on climate and jobs wins favour despite lack of development track record
Picking two African states, Côte d'Ivoire and Kenya, as his first ports of call on 6-8 March, appears to have boosted Ajay Banga's support in his campaign for the presidency of the World Bank. Strong support from Africa, one of the Bank's most important regions in terms of lending commitments and facing serial financial crises, could matter should a serious contender emerge to challenge Banga (AC Vol 63 No 21, Governments pushed close to the edge).
Next on his three-week tour will be stopovers in Asia, including China, Latin America and Europe.
Born and raised in India but with a high-level history in corporate United States, Banga is an astute choice as President Joe Biden's official nominee: his business background will help him win support in Congress and raise much-needed private counterpart funding for Bank projects. Banga's Indian heritage may dilute the sting, in developing economies, of the US having the final say over the Presidency of the Bank, due to it being its biggest shareholder.
European states have the same grip over the managing director position in the IMF. But in both institutions, this Western political dominance is under attack amid growing calls in the UN and among G20 countries for institutional and policy reform at the IMF and all the multilateral development banks.
The west's dominance at the World Bank and IMF also feeds into China's attack lines as Beijing officials argue that those institutions should be part of wider debt relief and forgiveness schemes (AC Vol 63 No 21, Mounting calls for global debt plan as payments crunch looms).
Dealing with such critiques will be one of Banga's first tasks should he become the Bank's next president when David Malpass is due to step down in June (Dispatches 23/2/23, David Malpass quits bank as radical changes loom). Neither Banga, nor US Treasury Secretary Janet Yellen, have argued that the Bank should risk its triple A market rating by being more generous on debt relief.
But they have advocated separately that it must do much more on climate financing and expand its balance sheet by raising funds more creatively with the private sector.
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