Thursday, April 19, 2007

Wolfowitz deputy urges him to quit

Wolfowitz deputy urges him to quit
By Krishna Guha and Eoin Callan in Washington
Copyright The Financial Times Limited 2007
Published: April 19 2007 01:17 | Last updated: April 19 2007 01:17


One of Paul Wolfowitz’s two deputies on Wednesday urged the World Bank president to resign as the civil war inside the institution reached top management.

Graeme Wheeler, managing director, made his call in front of all the bank’s top officials at an extraordinary session of their regular weekly meeting.

It is understood that other top managers of vice-president rank also suggested Mr Wolfowitz should go.

But Mr Wolfowitz – who has been under growing pressure following revelations that he was personally involved in securing a big pay rise as part of a secondment package to the US state department for his girlfriend Shaha Riza – told the meeting he had no intention of quitting.

Asked whether he denied that Mr Wheeler had told Mr Wolfowitz to resign, Marwan Muasher, vice-president for external affairs, said: “I do not comment on private meetings inside the bank.”

Within hours of Mr Wheeler’s call for Mr Wolfowitz to go in the interests of the bank, its regional teams of managers were taking sides.

Those from the bank’s Latin America region expressed strong support for Mr Wheeler’s position and agreed to threaten to resign en mass if Mr Wolfowitz stayed.

The East Asia and South Asia management teams also appeared to side with Mr Wheeler and against Mr Wolfowitz.

Meanwhile, the Africa and Middle East managers looked to be siding with Mr Wolfowitz.

The fissure that has opened at the top of the bank mirrors a gaping divide throughout the institution between Wolfowitz loyalists and the majority of officials who were there under his predecessor, Jim Wolfensohn.

The regions leaning in favour of Mr Wolfowitz are headed by officials appointed to vice-president rank by him; the regions leaning against him are headed by vice-presidents from the Wolfensohn bank.

At the vice-president level, the number of Wolfowitz appointees and Wolfensohn era executives is roughly equal. At all other levels of management and staff, officials from the Wolfensohn bank greatly outnumber the Wolfowitz appointees.

The bank staff association has already called on Mr Wolfowitz to quit following news of Ms Riza’s secondment package.

The danger that internal strife could cripple the bank will weigh heavily on its board - made up of representatives of shareholder governments - which meets again on Thursday.

On Sunday, ministers representing these governments, including the US, issued a statement that said: “We have to ensure that the bank can effectively carry out its mandate and maintain its credibility and reputation as well as the motivation of its staff.”

Speaking before the latest news, a White House spokesman said: “The President has full confidence in president Wolfowitz.”

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