2021-10-12 20:22:27 I.M.F.’s Executive Board Says Kristalina Georgieva Can Remain
I.M.F.’s Executive Board Says Kristalina Georgieva Can Remain
WASHINGTON (AP) — The International Monetary Fund’s executive board expressed confidence in Kristalina Georgieva, its managing director, on Monday, following allegations that she manipulated data to appease China when she was a senior World Bank official.
An independent investigation commissioned by the World Bank last month concluded that Ms. Georgieva was central to tampering with its 2018 Doing Business survey. The findings called into question her judgment and ability to lead the I.M.F. in the future. However, its executive board ultimately determined that the investigation “did not conclusively demonstrate” that she had acted improperly.
“Having considered all of the evidence presented, the executive board reaffirms its full confidence in the managing director’s leadership and ability to continue to carry out her duties effectively,” the board said in a statement. “The board believes in the managing director’s commitment to the I.M.F.’s highest standards of governance and integrity.”
Ms. Georgieva, a Bulgarian economist, had strong backing from many of the I.M.F.’s shareholders, including France, which had lobbied hard for her appointment in 2019. The United States, the fund’s largest shareholder, declined to publicly support her following the allegations but did not call for her removal.
The Treasury Department said that Treasury Secretary Janet L. Yellen spoke with Ms. Georgieva on Monday and told her that the World Bank investigation “raised legitimate issues and concerns.” According to a readout of the call, Ms. Yellen stated that in the absence of “further direct evidence” regarding Ms. Georgieva’s role in data manipulation at the World Bank, there was no basis for a change in leadership at the fund.
The result could result in political fallout for the Biden administration. Republicans and Democrats in Congress urged Ms. Yellen to insist on “full accountability” after it was revealed that Ms. Georgieva had directed staff to find a way to ensure that China’s ranking did not fall in the World Bank’s annual report on national business climates.
The Biden administration, as well as lawmakers from both parties, have expressed concern about China’s increasing economic clout and influence in multilateral institutions.
For weeks, Treasury Department officials debated the gravity of the revelations, publicly insisting that the process of reviewing Ms. Georgieva’s actions at the World Bank be allowed to proceed.
The World Bank’s Doing Business report evaluated the business climate in countries worldwide. Developing countries, in particular, were very concerned with their rankings, which they used to attract foreign investment.
At the time of the alleged manipulation, World Bank officials were concerned about negotiations with members over a capital increase and were under pressure not to irritate China, which was ranked 78th on the list of countries in 2017 and was expected to fall further in the 2018 report.
According to the investigation, Jim Yong Kim, the bank’s president at the time, held meetings to discuss ways to improve China’s ranking. Ms. Georgieva also got involved, collaborating with a top aide to devise a method to improve China’s image without affecting other countries’ rankings.
Ms. Georgieva was “directly involved” in efforts to improve China’s ranking, according to the investigation, and at one point chastised the bank’s China director for mismanaging the bank’s relationship with the country.
The International Monetary Fund’s executive board spent hours last week interviewing officials from WilmerHale, the law firm that conducted the World Bank’s investigation. They also interviewed Ms. Georgieva, who criticized the investigation’s process while insisting that she had acted appropriately.
“The WilmerHale Report does not accurately characterize my actions in relation to Doing Business 2018, nor does it accurately portray my character or the manner in which I have conducted myself over a long professional career,” Ms. Georgieva said in a statement to the board obtained by The New York Times.
Ms. Georgieva was a long-serving World Bank employee who rose through the ranks to become the bank’s CEO. She previously served on the European Commission, the executive body of the European Union, and she holds a Ph.D. in economics from Sofia’s University of National and World Economy, where she also taught.
Ms. Georgieva said in a statement on Monday night that the incident had been difficult for her personally and that she was grateful the I.M.F. board of directors had expressed confidence in her leadership.
“I am pleased that the I.M.F. board agrees that the allegations were unfounded after a thorough, unbiased review of the facts,” Ms. Georgieva said. “Trust and integrity are the bedrocks of the multinational organizations I’ve faithfully served for more than four decades.”