This post was co-authored by Arvind Subramanian.
The next World Bank president will need the legitimacy and wide support that only an open and merit-based selection process can ensure. This is now commonly agreed. The best way to ensure legitimacy is to have more than one serious candidate. The Obama administration is sure to nominate a strong candidate. Obama cannot be seen to be relinquishing the right of the United States to name an American, especially in this election year. But the U.S. has signaled its willingness to participate in an open and competitive and process. And the bank's board has called for nominations from all member states, which the board says it will then narrow to a short list of three.
Three strong candidates would offer the benefits of true competition. Each would make his or her case to all member countries, based on their personal record and vision for the bank's future direction. Each would be adequately vetted officially and unofficially around the world -- reducing the risk of scandals that within recent memory engulfed the heads of both the IMF and the World Bank.
But the current U.S. monopoly on the World Bank presidency, combined with the EU monopoly on IMF leadership, is difficult to break. The U.S. and Europe together have a large share of voting rights. Once they agree on a candidate, any alternative candidate needs to be an obvious and outstanding choice, and from a country willing and able to seek support from other large and influential developing countries. Fortunately there are several such candidates. Consider two top notch candidates, both from large, fast-growing democracies in the developing world. If nominated, they would surely make the board's short list.
Ngozi Okonjo-Iweala is currently the economics czarina in Nigeria. A Harvard graduate with a Ph.D. from MIT in economics, she rose through the meritocratic World Bank bureaucracy in the years when doing so as a woman and an African meant you had to be a star. She then garnered international recognition as Nigeria's Minister of Finance in 2003-06, when she championed tough economic reforms, insisted on fiscal transparency to combat corruption, negotiated for Nigeria a $37 billion debt relief package and oversaw Nigeria's first ever sovereign credit rating. Returning to the World Bank in 2006, she served as a virtual second-in-command to World Bank president Bob Zoellick. Most important, Okonjo-Iweala is a charismatic and effective diplomat as well as a good economist, admired and liked in China, in Africa and in the advanced economies. And wouldn't it be nice to have two highly capable women leading the world's two major international financial institutions?
Nandan Nilekani is the Indian co-founder of INFOSYS, one of the iconic technology companies in the developing world. Under his leadership, INFOSYS not only created wealth and opportunities and transformed India but did so by putting in place world-class standards of corporate governance. Two years ago Nilekani accepted a ministerial post in the government of India, where he is now managing one of the biggest development projects in the world -- using biometric identification technology to transform the provision of private and public services to all Indians, including the poorest and most marginalized. He has done so despite political and bureaucratic obstacles that led many to predict it was impossible. He has a deep grasp of economic, social and political issues that matter throughout the developing world, reflected in his combination of private and public experience and in an award-winning and best-selling book on India. Finally, he and his wife have been committed philanthropists in India (in the manner of Bill and Melinda Gates), giving widely and generously.
Either of these candidates, and any other non-American, would need the support of China to be credible. But they need not have that support to be nominated, and winning it might not be too farfetched. China might well support a developing country candidate at the World Bank -- perhaps even an Indian (maybe in exchange for some other favor). China's support for a Nigerian candidate would be easier still, given China's engagement with Africa; indeed the United States and Europe might see some benefits in a Nigerian World Bank president helping ease current tensions over the different approaches of China and the West to investments and aid in Africa.
It is high time that the Bretton Woods institutions adapted to changing global realities and shifts in economic and political power. In choosing the successor to Zoellick, the world needs a competitive process to finally challenge the outdated backroom deal from which the United States and Europe seem unable on their own to liberate themselves. It's up to developing countries such as Nigeria, India, and others to seize the current opportunity and nominate outstanding candidates.