Trump taps World Bank critic to lead World Bank
February 6, 2019
President Trump on Wednesday nominated a critic of the World Bank to lead the very same institution.
Nominee David Malpass, a senior official in the Treasury Department, is known as a Trump loyalist and an advocate of "pro-growth" policies who has vowed to reform the global development lending institution.
Trump called Malpass "an extraordinary man" who is the "right person" to lead the World Bank as its next president.
"He has fought to ensure financing is focused on the places and projects that truly need assistance, including people living in extreme poverty," Trump said from the White House, with Malpass at his side.
Malpass will need to win the backing of a majority of the World Bank's shareholders, made up of 188 other countries, and in particular the backing of European nations.
The US is the bank's largest shareholder, with 16 percent of its voting power, and has traditionally chosen the bank's president since its founding following World War II.
"America is the largest contributor to the World Bank," Trump said. "My administration has made it a top priority to ensure that US taxpayers' dollars are spent effectively and wisely."
The final decision on the World Bank president is made by the bank's board.
Promises of reform
Trump has lambasted multilateral institutions since taking office, and Malpass himself has been an outspoken critic of the World Bank and the International Monetary Fund, its sister lending institution.
Malpass has called the banks "entrenched" and "intrusive" and described their lending practices "corrupt." He has also complained about financing to China and other nations that he argues should no longer be eligible for loans.
If he were to be approved as president, Malpass said he would implement reforms approved last year, such as curbing loans and charging China higher interest, in order to increase the bank's lending capital by $13 billion (€11.4 billion).
"I'm very optimistic that we can achieve breakthroughs to create growth abroad that will help us combat extreme poverty and increase economic opportunities in the developing world," Malpass said.
'Toxic choice'
Malpass's nomination comes after the early departure of the World Bank's previous president, Jim Yong Kim, earlier this week.
In the lead up to Trump's announcement, as speculation grew that he would tap Malpass, many officials from both the Republican and Democratic party spoke out against the nomination, highlighting Malpass's failure to foresee the global financial crisis and his opposition to Federal Reserve policies.
Malpass worked as the chief economist at Bear Sterns when the investment bank tanked during the 2008 financial crisis.
"David Malpass would be a disastrous, toxic choice for World Bank president," said Tony Fratto, a former Treasury assistant secretary in the George W. Bush administration.
Nominations for World Bank president will continue to be accepted by its board through March 14, with a selection scheduled to take place before the next meetings from April 12-14 in Washington, DC.
cmb/aw (AFP, Reuters, AP)