CAFOD Welcomes Wolfowitz's Resignation from World Bank

The Catholic Agency for Overseas Development has welcomed the resignation of Paul Wolfowitz as president of the World Bank on Thursday with a call to the organization to introduce reforms that will benefit developing countries.

Wolfowitz found himself at the centre of a major controversy after he personally oversaw the promotion of his girlfriend and awarded her a pay rise twice as large as is permitted under bank regulations, prompting a formal investigation by the World Bank's board of directors and numerous calls for his resignation.

His resignation will take effect on 30 June.

Now CAFOD is calling on rich donor nations to use his departure as an opportunity to reform the way in which the head of the World Bank is appointed.

Many, including Christian Aid, have said the World Bank's current agreement is undemocratic because it allows the US government to nominate the World Bank president.

European governments, meanwhile, nominate the managing director of the organisation's sister agency, the International Monetary Fund, a set-up which humanitarian and trade justice groups have criticised for leaving developing nations largely out of the selection process.

"Paul Wolfowitz's tenure at the World Bank and the recent scandal raises questions as to whether he was the right man for the job of fighting poverty in developing countries," CAFOD head of Policy George Gelber, said.

"It is remarkable that in the 21st Century, these key appointments are made on the basis of nods and winks from the United States and Europe respectively."

CAFOD previously called for the head of the World Bank and the International Monetary Fund to be appointed by a public appointment process. It is now calling for a new selection process to replace the current agreement, which has been in place for the last 50 years.

"The resignation of Mr Wolfowitz as President of the World Bank is an opportunity for this 50 year old gentlemen's agreement to be replaced by a democratic and transparent leadership selection process based on merit," Mr Gelber added.

"This must change to give developing and transition countries a greater voice, in light of their rights, population and growing influence in the world today."