Thursday, September 30, 2010

Who should lead a multipolar world?
World Bank visits Georgetown

The President of the World Bank, Robert Zoellick, visited Georgetown University yesterday. I asked him about the future of the leadership of the organization. World Bank lending decisions are partly influenced by US strategic interests (see my research on this here), and this is partly due to US dominance of the governance of the institution. The President of the Bank has always been (de facto) an American, and the Bank is careful to cater to US interests.

I jokingly pointed out, following the observation of The Daily Show, from Wolfenson, to Wolfowitz, to Zoellick, the Presidents of the World Bank appear to be chosen alphabetically. Does this mean that for the next President, we'll return to the beginning of the alphabet, choosing someone like "Another American"? Or is it time for the leadership of the World Bank to go to someone from the emerging market world?

Zoellick gave a good answer. He explained that later in the day, he would visit Congress to report on the World Bank. If the leader of the Bank were not an American, and the United States had less control over the institution, perhaps Congress would be less willing to support it financially. This is a fair point, with backing from related research by Lawrence Broz (here, here, and here). Yet, emerging markets are becoming powerful enough these days that if they don't see change in the leadership of global institutions, they too can abandon them in favor of regional organizations, where they have a stronger voice and more political control.

So, I think that the Bank is in a bind. If it does not make governance more inclusive, it will (continue to) lose the interest of emerging market countries. But if it does away with US power, Congress may indeed be less likely to approve future increases to contributions.

Either way, the global institution risks irrelevance - the threat of which does not actually bother the emerging market world.

Perhaps this is the signature of a multipolar world, where no one is strong enough to dominate at the international level - and regional hegemons emerge. If this is so, I think a potential solution for the Bank is to recognize the growing strength of regional organizations and find ways to engage and work with them.

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