In the IMF’s executive board’s formal review, the International Monetary Fund chief Kristalina Georgieva denied allegations that she pressured World Bank staff to alter data to favor China, while she was the CEO of the World Bank CEO. Georgieva addressed strong staffs, about the findings contained in an independent report. It had data irregularities in the World Bank‘s now-canceled “Doing Business” rankings of country business climates.
The meeting’s transcription implies that she told the IMF staffs that, neither in this case, nor before or after, that she had put pressure on staffs to manipulate data. Her remarks went further than her statement that said, she fundamentally disagreed with the findings of the report, which was prepared by the law firm WilmerHale. Georgieva and other senior World Bank officials applied undue pressure on staff, to boost China’s ranking in terms of business climate. And also, she highly values data and analysis, without pressuring the staff to change it. WilmerHale said that it is working on a second report. And that will address potential misconduct of staff members in connection with the data irregularities.
Rice also said that as a part of the regular procedure in such matters, the ethics committee will report to the board. The World Bank was seeking China’s support for a big capital increase at the time. This is in an effort that Georgieva and the World Bank’s President Jim Yong Kim were overseeing. Georgieva has led the IMF and its roughly 2,500 staff since October 2019. The United States, France, Britain and Japan, were among some countries that are emergency funding for this pandemic.
The World Bank would cancel the Doing Business report series. This is by dismaying investors who rely on it to help them assess country risk. The cancellation and allegations were felt on Wall Street and Washington. Senator Marco Rubio of Florida stated that those complicit should be held accountable, and free nations need to seriously re-evaluate the role they allow Beijing to play in global institutions. Senator Bill Hagerty, the top Republican on the Senate Banking Committee’s international trade and finance subcommittee, asked for restoration of this valuable report under conditions they can trust rather than its cancellation.
Paul Romer, a former World Bank chief economist, said that Georgieva sidelined him from making the improvements. Romer, a Nobel laureate economist at New York University, left the bank over the controversy in 2018. He said that there was a willingness to do whatever worked or whatever seemed appropriate at any point without any guiding principles. The news and any fallout is likely to dominate the IMF and World Bank annual meetings that are going to be held in Washington.