New World Bank chief

After some introspection, the Board of Directors of the World Bank has finally selected a Korean-American physician, Jim Yong Kim, as its next chief, confirming the tradition of appointing a US citizen as the Bank's head, despite the first-ever challenge to the US lock on Bank's presidency. Kim, a 52-year health expert and educator was chosen over Nigerian Finance Minister Ngozi Okonjo-Iweala who had argued that huge development lender of the world needed reorientation under someone from the developing world.
The Bank's Directors, after making their final decision, nonetheless, expressed deep appreciation to Kim, Okonjo-Iweala and a third candidate, Colombian economist Jose Ocampo who had pulled out of the race earlier, saying that "their candidacies enriched the discussion of the role of the President and the World Group's future direction. The nominees had received support from different member countries, which reflected the high calibre of the candidates." Kim, after being nominated, assured that he had the ability to work with economists and other specialists in running the Bank, which has a staff of 9,000 and a loan portfolio that hit $258 billion in 2011. Before embarking on a global spanning trip, he also asserted that he had an open mind and would apply his medical and socio-economic training to take an evidence-based approach.
Although, there was no tough competition from other (non-US) candidates, yet the occasion was marked by some unusual developments this time. There was a long-standing consensus that Washington would nominate a US citizen as the head of the World Bank while Europe would decide about the leader of its sister institution, the International Monetary Fund. It was for the first time in the history of the Bretton Woods institutions that such an assumed right of US and Europe was seriously challenged. Though the developed countries, particularly the US, could rule out such a possibility due to their excessive quotas and voting power in such institutions for the time being, yet they would increasingly find themselves on a weaker wicket on moral grounds in the coming years.
Already Oxfam, a global development agency, has termed the selection process of the World Bank President as "sham", arguing that "we will never know if he (Kim) was the best candidate for the job, because there was no true or fair competition". Also, an important point to be noted was that there was no comparison between Kim and any of the prior World Bank presidents. While previous presidents were mostly political insiders, known economists or financial gurus, Kim was not a familiar face and had spent most of his life to improve the lives of poor people.
However, while welcoming the new Chief at the World Bank, we can clearly see his difficulties in the days ahead. He assumes the office at a time when world economies including those of the US and European countries are almost in turmoil and, therefore, would hardly be able to release resources to be placed at the disposal of the World Bank for investment in the developing countries, with the result that projects in these countries could suffer. In our view, it would be a huge challenge for Kim to raise the necessary resources in an inhospitable environment. Besides, some of the regional countries are thinking about setting up their own development institutions. For instances, BRICS' heads of states in their recent summit in New Delhi have instructed their finance ministers to prepare a blueprint for such an institution. Such initiatives are likely to reduce the importance of World Bank as a development institution. Therefore, it would be vital for the new World Bank President to chalk out a more dynamic role for his institution so that it remains relevant in the new environment.