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WASHINGTON: The World Bank executive board is expected to deliver its verdict this week on the future of embattled bank president Paul Wolfowitz who faces demands to step down over nepotism allegations.
With Wolfowitz's fate in doubt, the 24-member board convenes on Tuesday to consider his future in light of accusations he secured an improper pay and promotion deal for his companion, a fellow bank employee.
Wolfowitz, 63, a former top US Defense Department official and an architect of the Iraq war, has been invited to appear before the board to present his side of the story.
However, his tenure at the helm of the poverty-fighting bank has appeared increasingly tenuous.
A special bank committee investigating the case has already concluded that Wolfowitz broke the organisation's ethics rules when he arranged the pay package for his companion, Shaha Riza, upon his arrival at the bank in June 2005.
It remains unclear how the executive board will choose to exercise its authority at an institution that customarily operates by consensus. Will the board hold a vote to sack Wolfowitz, or issue a judgment on the charges against him?
The affair has dragged on for more than a month and divided the bank's 185 member states, with the United States standing by Wolfowitz and European governments pushing for his early exit.
As pressure mounted in recent days amid transatlantic divisions, opponents of Wolfowitz were looking for a way to avoid a direct confrontation.
"The key European leaders don't want to have another controversy with the United States," said Michael Mussa, former chief economist at the IMF and now a senior fellow at the Peterson Institute for International Economics.
"They want Wolfowitz to jump without visibly being pushed," he said.
In a letter to US President George W. Bush, the leader of the Democratic majority in the Senate, Harry Reid, and other lawmakers appealed to the White House to take prompt action to defuse the crisis.
The senators expressed concern that the affair posed a threat to Washington's role at the bank, warning the White House the executive board might be forced to take the unprecedented step of voting on Wolfowitz's future.
"We do not believe the bank's mission or US interests would be advanced by such a vote," the senators said. "We urge you to take decisive action quickly to bring this crisis to a close."
Speculation as to who might succeed Wolfowitz has already begun.
Media reports put Robert Zoellick, the former US trade representative, at the top of the list, followed by Egyptian Mohammed el-Erian, who manages Harvard University's vast endowment and Kemal Davis of Turkey, head of the UN Development Program.
Traditionally, the United States names the World Bank president and European governments name the head of the International Monetary Fund.
The right-leaning Wall Street Journal, which until now gave strong backing to Wolfowitz, suggested on Friday the Bush administration could name him to a senior post in the State Department or as an ambassador to Pakistan, Indonesia or Nigeria.
"What they really need is to find some way to offer Wolfowitz a more gracious way out," Mussa said.
"The main thing is: he has to go. The fact is that he is so damaged that he just cannot function."
- AFP/yy
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