World Bank President Jim Kim resigns: what’s his legacy and what happens next?

January 10, 2019

     By Duncan Green     

Speculation is swirling about the reasons for World Bank President Jim Yong Kim’s abrupt departure this week. But what’s his legacy, and what happens next? Nadia Daar, head of Oxfam’s Washington DC office, gives a steer.

On Monday when I drafted Oxfam’s reaction to news of World Bank Jim Kim’s abrupt and unexpected departure from the World Bank, I said he was leaving behind a lasting legacy. And he is. But it’s a mixed bag.

Jim Kim started his tenure by pushing through a strong new Corporate Strategy for the World Bank Group. One World Bank Group where all arms of the Bank would work in harmony to achieve the Bank’s twin goals of ending extreme poverty by 2030 and boosting shared prosperity. Sound like obvious goals for an institution with an explicit mandate to combat poverty? Well, sure, but what JYK did was push through concrete targets and create a framework in which every Bank operation would have to be tied to those goals explicitly.

Now, how that plays out, how much flexibility there is, how things are measured (we wished the shared prosperity goal had been more about tackling inequality – i.e. not just looking at the bottom but the top as well) is a different story, but it was a big move for the Bank.

Alongside that, and in the wake of the happier and more optimistic days of the Arab Spring where the buzz phrase was “a new social contract”, under JYK’s leadership, the Bank approved a new Framework for Mainstreaming Citizen Engagement, something that would have been scoffed at just a decade earlier.

But after a few years of being at the Bank, JYK’s tone and language changed significantly: from fighting poverty to economic growth, from health, education and human development to human capital, from citizen engagement to private sector engagement. His increased attention to mobilizing private finance is not his agenda alone of course; this mandate was given to all multilateral development banks by the G20 with the Maximizing Finance for Development Agenda. Yet Jim Kim has run at lightning speed with this, moving the Bank in an unprecedented way, changing processes and incentives around leveraging private sector capital and paving the way for more investment in privatized social services,  which threaten to deepen inequality and exclusion.

The bag is even more mixed the deeper we look: while he has led the Bank with several strong climate positions like this and this and this, many have also blamed him for failing to take more leadership around the environmental and social safeguards review a few years back which resulted in a policy void of human rights language and dangerously flexible and vague standards. Both sets of decisions will have lasting impacts for years to come.

Now a lot has happened over the course of JYK’s tenure: the monumental SDGs and the Paris agreement were approved; the Asian Infrastructure Investment Bank and the BRICS New Development Bank came online; and we entered the era of Trump: an administration that has not been friendly to multilateralism (despite supporting a massive General Capital Increase for the Bank of $13bn in 2018).

At the same time, there has been an unprecedented displacement crisis. 68.5 million people have been forcibly displaced, 85% of them in developing countries and over half under 18. The Arab Spring turned into a nightmare winter in many countries, including Yemen, which is now the worst humanitarian situation in the world; and governments are closing down civic space around the world at an alarming rate.

This is not an easy world for advocates of multilateralism though its importance could not be overstated. As a major global institution with huge convening and financial power, it is crucial that the next leader of the Bank be up to the task. Critically, among the madness of

the times, they have to put communities in poverty at the heart and center of all decisions.

So, how do we get there?

First on process. Let’s rewind to 2011, in the run-up to JYK’s appointment:

After years of pressure to move away from the unspoken agreement of always having an American president, the Bank announces new procedures for the selection of the World Bank president.

2012: Civil society and academics push for a merit-based, open and transparent World Bank president selection process. One that is open and where it is not pre-determined to be the American nominee.

Jim Kim is put forward as the US nominee. He has some serious competition in Ngozi Okonjo-Iweala and José Antonio Ocampo, who also make it to the short list. But bam! He is selected. Many felt that it had been a sham and that he had been the pre-destined winner all along, and despite his credentials, the process was heavily criticized.

Fast forward to JYK’s reappointment in 2016 and the Board announces that this will be an open process, yet nobody apparently is put forward as an opposing candidate and Jim Kim is swiftly voted through as the sole contender.

In 2019, we now have another opportunity to get it right. The Board has announced they are starting the selection process. This means that once the time comes, any government can put forward a candidate. But the process must be truly open and not just in theory. The US nominee, whoever that will be, cannot be the predetermined next president of the World Bank.

The person chosen through this selection process must be qualified: I’m crossing fingers for someone who has, among other qualifications, a demonstrated commitment to fighting poverty and inequality, with a commitment to human rights principles, who cares about the planet we’ll leave behind for future generations, who believes in multilateral cooperation, and who will put women and communities first. In my mind, that shouldn’t be a tall order for the leader of an institution mandated to fight poverty.

One grain of optimism: given the White House’s detachment from all things multilateral, this might just be a moment when the Bank can finally make these kinds of changes. Clouds, silver linings etc.

Our best chance is if governments around the world quickly put forward qualified candidates to help ensure a competitive and merit-based process. Let’s get this right.

January 10, 2019
Duncan Green