IMF “backs” Georgieva after data-rigging claims, US and Japan want scrutiny

THE International Monetary Fund’s (IMF) executive board will issue a statement of support for its embattled managing director Kristalina Georgieva after reviewing allegations she pressured World Bank staff to alter data to favour China, sources familiar with the decision said yesterday.

The 24-member board reached the decision yesterday after marathon meetings over the past week, where members debated the future of Georgieva, a Bulgarian economist and the first person from a developing country to head the fund.

France and other European Governments said last week they wanted Georgieva to serve out her term, while US and Japanese officials pushed for a thorough review of the allegations, according to separate sources briefed on the matter.

At issue was a damning report prepared by the law firm WilmerHale for the World Bank’s board about data irregularities in the bank’s now-cancelled “Doing Business” report.

The firm’s report alleged that Georgieva and other senior officials applied “undue pressure” on bank staff to make changes to boost China’s ranking in the report, just as the bank was seeking Beijing’s support for a major capital increase.

Georgieva strongly denied the allegations, which date back to 2017, when she was the World Bank’s chief executive. She became the IMF’s managing director in October 2019.

France and other European Governments had pressed for a speedy resolution of the matter ahead of this week’s annual meetings of the IMF and World Bank, where Georgieva and World Bank President David Malpass are leading discussions on the global recovery from the COVID-19 pandemic, debt relief and efforts to speed vaccinations.

The US and Japan, the fund’s two largest shareholders, cautioned against prematurely reconfirming confidence in the IMF leader, said one of the sources.

No matter who is to blame for the altered data, current and former staff from both institutions say the scandal has dented their research reputations, raising critical questions over whether that work is subject to member-country influence.

Malpass declined to comment yesterday on the IMF process, but said the World Bank was working to improve the integrity of its research, including by elevating its chief economist, Carmen Reinhart, to be part of the bank’s 10-person senior management team. – Oct 12, 2021.

 

Pic credit: The Bangkok Post

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