Tags: Summers | Clinton | world | Bank

Summers, Clinton Said to Be Lead Contenders for World Bank

Thursday, 16 February 2012 08:46 AM EST

U.S. Secretary of State Hillary Clinton and former White House economic adviser Lawrence Summers are two leading candidates to succeed World Bank President Robert Zoellick when he leaves in June, said two people familiar with Obama administration discussions.

The U.S. promised a candidate “in the coming weeks” for the post that has always been held by one of its citizens, while officials from Brazil and Mexico vowed to make the selection process open to emerging markets.

“It is very important that we continue to have strong, effective leadership in this important institution,” Treasury Secretary Timothy F. Geithner said in an e-mail yesterday, four hours after Zoellick, 58, announced he will leave at the end of his five-year term. The U.S. choice will have “the experience and requisite qualities to take this institution forward,” Geithner said.

While Summers has expressed interest in the position and has supporters inside the administration, the position would be Clinton’s if she sought it, according to the people, who spoke on condition of anonymity about the private conversations.

Clinton, who said previously she doesn’t plan to remain in her post if President Barack Obama wins a second term, repeatedly has denied having an interest in the World Bank job. State Department spokesman Victoria Nuland repeated those denials yesterday.

View Not Changed

“The secretary has addressed this issue many times since last year,” Nuland said at a briefing in Washington. “She has said this is not happening. Her view has not changed.”

Summers was traveling and unavailable for comment, his assistant, Julie Shample, said.

Officials in China, Brazil and Mexico jumped in to support the chances of someone from outside the U.S., possibly from an emerging-market country, to head the Washington-based lender.

“There’s no reason for the principal leader to come from a specific country,” Brazil’s finance minister, Guido Mantega, told reporters. “Emerging markets have the right to seek the leadership of the World Bank.”

Mexican central bank Governor Agustin Carstens, speaking in Mexico City, echoed that sentiment, saying the World Bank chief should be selected by merit, not pre-arranged rules.

China’s Foreign Ministry spokesman Liu Weimin, asked if the candidate should come from a developing nation, said the selection should be “based on the merit principle and open competition.’’

Close Ranks

The campaign for the helm of an institution that made $57 billion in loans in the last fiscal year will test the capacity of emerging markets to close ranks behind a candidate eight months after they failed to agree on an International Monetary Fund nominee. The World Bank job has always been held by a U.S. national under an informal agreement that also has a European head the IMF. The nomination is subject to approval by the World Bank’s executive board.

“As a marker, the emerging markets will put forward some candidates,” said Uri Dadush, director of international economics at the Carnegie Endowment for International Peace in Washington. “But it is probably the most likely outcome that the U.S. candidate will prevail just like the European candidate prevailed at the fund.”

Christine Lagarde, then France’s finance minister, was picked last year over Mexico’s Carstens for the IMF job with support from the U.S. as well as nations including Brazil.

Obama’s spokesman, Jay Carney, refused to comment on possible successors to Zoellick, who was nominated for the position by then-President George W. Bush in 2007 for a term that ends June 30.

Salary and Benefits

Zoellick received a net salary of $450,378 in the year through June 30, 2011, plus $284,329 in pension and other benefits contributions, according to the bank’s annual report.

“There’s been a lot of speculation in the press,” Carney told reporters traveling with the president to an event in Wisconsin. “I’m not going to confirm any of it.”

While Clinton, 64, told State Department employees at a town hall last month that she is tired after 20 years in public life, many of her associates say she might be willing to take the World Bank presidency. It requires fewer hours and less travel than being secretary of state, the people said.

Summers, 57, was Obama’s first director of the National Economic Council and served as Treasury secretary in President Bill Clinton’s administration. He left the Obama administration at the end of 2010 and returned to Harvard University in Cambridge, Massachusetts, where he is a professor at the John F. Kennedy School of Government.

© Copyright 2024 Bloomberg News. All rights reserved.

Thursday, 16 February 2012 08:46 AM
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