The Zedillo Report

Two days ago I attended the Washington, DC launch of the World Bank’s report on internal governance, headed by former Mexican president Ernesto Zedillo. You can download the report here.

The executive summary does a good job overviewing the report and is quite readable, so I’ll only briefly mention a few of the key recommendations:

  • The World Bank Group’s Board should shrink from 25 to 20 chairs. European countries should give up 4 chairs in this process.
  • Voting power at the IBRD should be decoupled from IMF quotas and non-donor countries should have a larger share of voting power (ideally around 12%).
  • Approval of all financing should be transferred to management. As it stands now, the Board has a say in financing, which prevents the Board from providing impartial oversight. No one wants to say something is wrong if they are partially at fault.
  • The standard unwritten rule where a US national is always president of the World Bank and a European national is always managing director of the IMF should be abandoned.
  • The Board should have to produce an annual review of the performance of the World Bank president.

The launch event featured a panel discussion with president Zedillo, Nancy Birdsall, Moisés Naím, and Arvind Subramanian. I was pleasantly surprised by how fast Moisés and Arvind cut to the core problem with the report: implementation.

While Moisés frequently called the report the best document he has seen on World Bank governance in over 20 years, he also clearly thought the plan was not implementable. How exactly does one convince the European countries to give up 4 Board seats? How would Obama sell the US giving up its ‘right’ to the presidency of the World Bank to the American public? These are important questions that the report does not address, and the result is that the report ends up reading like a comprehensive wish list. The lack of focus on implementation is unfortunate because the plan itself really seems quite well put together.

Nancy defended the report, arguing that now that a plan exists activists can focus on pressing for change. I can’t help but side a little more with Moisés though. I’d rather have a less than ideal report that can be implemented than a perfect plan that gets filed away.

You can find more commentary on the report here and an interview with president Zedillo about the report here.