Feb 3, 2019

The U.S. still controls the World Bank

Photos: Okonjo-Iweala by Shaun Curry/AFP/Getty; Malpass by Mario Tama/Getty

The next big test of U.S. dominance is going to be what happens when the Trump administration announces its nomination for the next president of the World Bank.

Driving the news: The front-runner is David Malpass, currently undersecretary for international affairs at Treasury. Malpass would be a divisive figure at the World Bank. If Malpass were to be nominated by the U.S., other shareholders might well nominate a rival candidate, probably former Nigerian Finance Minister Ngozi Okonjo-Iweala.

  • On paper, Okonjo-Iweala is far more qualified for the job than Malpass is, not least because she spent many years holding senior positions at the World Bank and knows how it works. She is also now a U.S. citizen and has interviewed at the White House for the World Bank job.
  • If the White House doesn't nominate Okonjo-Iweala, Malpass would probably win a competitive race against her. European countries would be very hesitant to vote against the U.S. candidate, lest the U.S. vote against their candidate when the IMF job next comes up for a vote.

The bottom line: If the U.S. were interested in forging consensus at the World Bank, it would nominate someone like Okonjo-Iweala, or former PIMCO chief Mohamed El-Erian, or former PepsiCo CEO Indra Nooyi. That candidate would then probably coast in unopposed. If Malpass gets the nod, that's a sign that Trump is uninterested in keeping the rest of the world happy.

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