IE 11 is not supported. For an optimal experience visit our site on another browser.

Wolfowitz says he won't quit World Bank post

Development ministers from around the globe on Sunday will discuss World Bank President Paul Wolfowitz’s leadership, which has been called into question over his handling of a promotion for his girlfriend, a bank employee.
/ Source: msnbc.com news services

Embattled World Bank President Paul Wolfowitz said Sunday he will stay on the job, carrying out the bank’s mission to reduce poverty around the world.

“The bank has important work to do and I will continue to do it, “ he said at a news conference winding up a meeting of the steering committee for the bank and the International Monetary Fund.

There have been calls for Wolfowitz to resign as the head of the 185-nation lending organization over his involvement in a huge pay increase awarded to a close female friend.

The committee said the issue was “of great concern to us all” and called on the bank’s board that is looking into the matter to complete its work.

“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,” the committee said.

In answering questions about whether he should step down, Wolfowitz referred several times to the committee’s statement and said he did not want any comments he made to get in the way of the board’s work.

Meanwhile, development ministers from around the globe on Sunday were set to discuss Wolfowitz’s leadership, which has been called into question over his handling of a promotion for his girlfriend, a bank employee.

Moral authority in tatters
Sources told Reuters the ministers would discuss the issue at a luncheon, as they take a break from a meeting of the joint IMF-World Bank Development Committee.

Wolfowitz's handling of the promotion of girlfriend, Shaha Riza, has left the moral authority of the institution in tatters, say staff and anti-poverty activists.

The former No. 2 at the Pentagon has apologized, saying he was advised by a World Bank ethics panel to assign Riza to a job outside the bank to avoid a conflict of interest.

While his backers in the White House have come to his defense, large shareholders like Britain, Germany and France have questioned whether he still has the credibility to lead the bank, which spends about $25 billion a year on projects to fight poverty in developing countries.

African ministers have expressed confidence in Wolfowitz, saying he has helped to focus attention on their needs.

Many World Bank member countries have cautioned against judging Wolfowitz until a closer examination by the bank’s board wraps up.

Lingering antagonism
Still, the scandal has fired up lingering antagonism over Wolfowitz’s appointment to the bank in mid-2005 by the U.S. administration and bitterness over his role in the U.S. invasion of Iraq while he was deputy defense secretary.

In notes of a speech prepared for delivery to the development committee on Sunday, Wolfowitz appealed to rich nations to deliver on aid promises and to keep the bank’s own coffers stocked so it can keep lending to needy countries.

“We stand half way to the 2010 goal post for doubling aid to Africa compared with 2004,” Wolfowitz said, as he outlined priority areas where the bank should focus its attention.

But his appeal was clouded by questions -- and concerns -- by the bank’s main donor countries, who are beginning year-long talks about replenishing the World Bank’s main lending fund.

Some insiders worry there is a danger some donors could withhold funding to the bank’s International Development Association, or IDA, if the scandal drains Wolfowitz’s credibility as World Bank president.