Trump & the World Bank Shuffle: David Malpass Takes the Helm
Donald Trump has just handed the reins of one of the globe’s top development lenders to a veteran Treasury official known for his outspoken take on the World Bank. No, this isn’t a plot twist in a political drama – it’s the real‑world saga of David Malpass entering the big leagues.
The Coup
- Trump dubbed Malpass “an extraordinary man”, a description that’s hard to take with a grain of salt.
- He emphasizes that the U.S. is the biggest borrower‑giving force at the World Bank and pledges to make sure taxpayer dollars are used wisely.
- Malpass is no stranger to the bank’s critics; he has publicly slammed its lending practices, calling them “corrupt” and complaining about aid going to wealthier nations like China.
- He’s vowed to enact last year’s reforms, hoping to throttle loans to rich countries and channel more funds to the poorest.
Big Picture: The Board’s Decision
After World Bank President Jim Yong Kim left abruptly in February, the board is now open to new nominations. The process runs until mid‑March, with a new leader expected before the IMF and World Bank spring meetings slated for April 12‑14 in Washington.
For a while, the U.S. has always commanded the World Bank seat, while the IMF’s chair has been a European. Emerging economies have long demanded a merit‑based pick, and Malpass’s selection could swing the balance.
European Vibes? A Tug‑of‑War
- The U.S. holds the largest stake but doesn’t wield veto power; it needs European allies to clinch a majority.
- Trade ambassador Steven Mnuchin is reportedly courting other shareholder nations.
- Malpass’s upcoming trips to Beijing and Tokyo – the top two shareholders – suggest a diplomatic push to win hearts.
Critics Speak
Former treasury insiders and political footballers aren’t buying the hype especially when Malpass has been accused of failing to foresee the global financial crash and of overlooking the Fed’s policies. Tony Fratto, a former Treasury assistant secretary, warned that “David Malpass would be a disastrous, toxic choice for World Bank president.”
Bottom Line
With the U.S. keen on ensuring world development dollars serve the promised purpose, the shuffle may signal a new direction for the World Bank. But will the U.S. manage to lease the support of its European partners in the face of a controversial pick? Only time – and the next board meeting – will tell.
