World Bank President Resigns

After two years as President at the World Bank, Paul Wolfowitz, architect of the Iraq war, tendered his resignation on Thursday evening.

“I have concluded that it is in the best interests of those whom this institution serves for that mission to be carried forward under new leadership,” writes Wolfowitz in a statement posted on the World Bank’s website.

His resignation follows weeks of public scrutiny and debate among the Bank’s Board of Directors regarding Wolfowitz’s involvement in a promotion for his girlfriend. However, this scandal triggered a much broader criticism of the Bank’s governance structures.

In a statement from the Board, Executive Directors of the Bank agree: “One conclusion we draw from this is the need to review the governance framework of the World Bank Group.” World Bank presidents may come and go but, unfortunately, the real scandal remains: that is a global public institution which continues to benefit the few rather than realizing the basic needs of the many.

Quick facts:

Despite billions of dollars of aid, loans and other investments in the energy sectors in impoverished countries, World Bank data reports that 77 percent of people in Sub-Saharan Africa—526 million people—still don’t have access to electricity.
In fiscal year (FY) 2006, the private sector lending arm of the World Bank, the International Finance Corporation, increased its lending for oil projects by 77%–from $150 million in FY05 to $264 million in FY06. (More on this…)
The soaring costs of oil are undermining the benefits of debt cancellation by draining far more money out of impoverished countries than canceled debts are able to contribute. According to figures compiled by the Center for American Progress (CAP), the cost of Tanzania’s oil imports rose by about $290 million from 2002 to 2006. Conversely, debt cancellation is expected to free up roughly $140 million in Tanzania in 2006, less than half of the additional amount that the country is paying for oil imports. (More on this…)