Monday, 29th May 2023

Biden nominates ex-Mastercard CEO to lead World Bank

23 February 2023   |   9:20 pm
US President Joe Biden on Thursday announced the nomination of former Mastercard chief executive Ajay Banga as a candidate to lead the World Bank, after the development lender's current head announced plans to step down early.

US President Joe Biden. (Photo by Brendan Smialowski / AFP)

US President Joe Biden on Thursday announced the nomination of former Mastercard chief executive Ajay Banga as a candidate to lead the World Bank, after the development lender’s current head announced plans to step down early.

The World Bank has just started accepting candidate nominations in a process set to run until March 29, with the bank saying that women contenders would be “strongly” encouraged.

The president of the Washington-based Bank is typically American, while the leader of the International Monetary Fund is customarily European.

Banga, who is Indian-American, was previously chief executive at Mastercard, and has also served on the boards of the American Red Cross, Kraft Foods and Dow Inc. He currently is vice chairman at private equity firm General Atlantic.

The 63-year-old Sikh was born and raised in India, travelling regularly as a child due to his father’s military career, and started his career there before emigrating to the United States.

Banga has “critical experience mobilizing public-private resources to tackle the most urgent challenges of our time, including climate change,” Biden said in a statement.

Last week, current World Bank President David Malpass said he would step down nearly a year early, ending a tenure that has been clouded by questions over his climate stance.

Malpass was appointed to the post in 2019 when Donald Trump was president, and would originally have ended his term in 2024.

Banga’s nomination comes amid a push for development lenders to revamp and more effectively address global problems like environmental issues.

Any of the bank’s 189 members can nominate a candidate, though in 2019, Malpass was the lone nominee to take over the helm of the institution.

In recent years, growing emerging market countries have challenged the unwritten arrangement of an American heading the World Bank.

“We had hoped that President Biden would use this opportunity to ditch the old gentlemen’s agreement of World Bank and IMF appointments in favor of a more transparent and merit-based global process,” said Oxfam International senior policy advisor Christian Donaldson.

The United States is the World Bank’s largest shareholder.

‘Green transition’

Speaking to reporters, a senior US administration official said: “At Mastercard and General Atlantic, Ajay has made combating climate change and mobilizing private capital to help power the green transition a priority.”

“These are experiences and priorities that will guide and drive his work in the years ahead at the World Bank,” the official added.

In a separate statement, US Treasury Secretary Janet Yellen said Banga’s record of forging partnerships between the public sector, private sector and non-profits will help him in mobilizing the private capital and pressing for necessary reforms.

Banga had joined Mastercard as president and chief operating officer in 2009, before being named chief executive a year later.

Prior to that, he was chief executive officer of Citigroup’s Asia-Pacific Region.

Growing disconnect

Luis Alberto Moreno, former president of the Inter-American Development Bank, told AFP that the World Bank is at a transformative moment as the global community grapples with heightened tensions and major development challenges, “the biggest of which has to do with the whole energy and climate transition.”

“We’re in a moment where there’s a growing disconnect between the global north and the global south. Just bringing that together takes somebody that not only has the technical skills, but the political skills,” Moreno added.

Asked about the World Bank’s encouragement for women candidates, a US official said Banga had a “personal conviction and excellent track record” in promoting diversity in his work.

The World Bank has been led by men since its founding in the aftermath of World War II.