Doctor’s World Bank Nomination Signals Renewed Development Focus

BY Ray Suarez  March 23, 2012 at 6:10 PM EST

U.S. President Barack Obama, right, introduces Jim Yong Kim as a nominee to become president of the World Bank
President Obama, right, introduces Jim Yong Kim as the nominee to become World Bank president at the White House on Friday. Photo by Andrew Harrer/Bloomberg via Getty Images

President Obama announced the nomination of Dr. Jim Yong Kim, a physician and the president of Dartmouth College, to the presidency of the World Bank on Friday. If confirmed, Kim would succeed Robert Zoellick as the leader of this important lending institution based in Washington, D.C. The nod must come as a surprise to bank watchers around the world. Kim’s name had not appeared on any short lists circulating in the media in the weeks leading up to the appointment deadline.

Kim would succeed a long line of economists and career government employees at the helm of the World Bank, which was created in the waning days of the WWII to begin the rebuilding of a ravaged world.

So, why not a central banker? Why not a career economist? Why not a conventional “green eyeshade” guy or gal to run the place? Zoellick’s tenure at the bank capped a long economics career in and out of government service: Treasury Department deputy assistant secretary for Financial Institution Policy, executive vice president of Fannie Mae, U.S. trade representative.

A closer look at the bank and at Kim reveals a strong internal logic to the appointment. No one in Washington has a mortgage or Christmas club account at the World Bank. There are no teller windows, no ATMs and no toaster ovens for transferring from another bank. More than anything else, the World Bank is a source of loans for developing countries.

The World Bank includes five agencies, including the International Development Agency, which gives interest-free loans and grants to governments of the poorest countries; the International Finance Corporation, which encourages investment and technical assistance from the private sector to developing countries; and the International Bank for Reconstruction and Development, which makes loans to middle-income countries and a small number of creditworthy poorer states.

Considering the bank’s role as an international economic development agency, the selection of Kim over, for example, former Treasury Secretary Lawrence Summers, starts to make more sense. Kim is a co-founder and former executive director of Partners in Health, which has grown from its focus on rural Haiti to implementing programs across the world’s poorest countries aimed at improving basic health services. The Harvard-education physician served two years as head of the World Health Organization’s HIV/AIDS department and has been an international leader in anti-tuberculosis policy. Kim is also a co-founder of the Global Health Delivery Project, which seeks to build new systems for providing basic health services to populations in poverty.

It may turn out that his earlier experience may serve him better at the World Bank than it has at Dartmouth. He arrived at the Ivy League campus in New Hampshire as the school was reeling from the loss of portfolio value following the collapse of the stock market. Since the shrinking endowment was the source of almost a quarter of the school’s operating budget, immediate and sizable budget cuts of $100 million over two years were required from the moment Kim took office. There followed disputes with faculty, students, and alumni over priorities, governance, alcohol use, assaults and Greek life on campus. It would have been a tough 2 1/2 years for anyone, but it was a particular challenge for a new leader in the spotlight: Kim was the first Asian American to lead an Ivy League school.

When Zoellick announced he would be leaving the World Bank, a season of hot speculation and open campaigning for the departing president’s seat began. Though Americans have led the World Bank since it was established, candidates from what’s often called the Global South attracted attention: Nigerian Finance Minister Ngozi Okonjo-Iweala and former Colombian Finance Minister Jose Antonio Ocampo. Jeffrey Sachs of the Earth Institute at Columbia University attracted strong attention in the U.S. and was supported by political progressives as an alternative to rumored candidates such as Summers. Troubles that began in the U.S. pushed the world economy to a precipice in 2008, so the appeal of a new president from somewhere else in the world was growing.

Kim was born in South Korea and came to the U.S. as a boy. His time at Dartmouth has attracted intense attention and favorable media coverage in South Korea. Kim’s immigrant journey may blunt some of the criticism expected of yet another American nominee to the influential post. In his announcement of the appointment, Mr. Obama said:

(Kim’s) worked from Asia to Africa to the Americas, from capitals to small villages. His personal story exemplifies the fact that anyone can make it as far as he has as long as they’re willing to work hard and look out for others. And his experience makes him ideally suited to forge partnerships all around the world.

Kim’s status as an experienced hand in public health, disease prevention, and raising the skills and self-sufficiency in developing countries mirrors changes at the World Bank itself in recent decades. It will be interesting to see whether a medical doctor can continue the challenging work of creating a better image for the bank in the rest of the world as well as putting more than $40 billion a year in lending on sound economic footing.

For a long time, the institution was cast as an international villain — doing business with undemocratic regimes, funding huge and destructive white elephant projects, and causing environmental havoc in Asia, Africa, and Latin America. The World Bank, and its Washington-area neighbor the International Monetary Fund, have stepped away from showy marquee projects such as hydroelectric dams. Instead, they have concentrated on projects more likely to change the life circumstances of common people in poor countries. Along with better investment, the World Bank has put more focus on representative, responsive and accountable government in the countries where it lends.

Partners in Health, meanwhile, insists doctors and technocrats from wealthy countries cannot parachute in to a poor country and start giving aid on the condition that they give the orders. The organization co-founded with Dr. Paul Farmer and others has always stressed listening to hospital administrators, health ministers and doctors in the developing world rather than telling them what to do. That’s not too far from what you hear around the World Bank.

The bank still has its critics and detractors, and countries around the world still groan under the weight of debt incurred in previous decades through ill-conceived borrowing. Kim, too, will have his critics — both for insufficient experience in lending and financing capital projects in the developing world and from his time at Dartmouth. However, with voting for the new president weighted by contributions to the World Bank, the U.S. government’s backing of Kim makes him a prohibitive favorite in the coming balloting. The appointment of a public health professional may represent the final installment in a decades-long transition for the World Bank.