Zoellick Wins Backing for New World Bank Strategy


World Bank President Robert Zoellick on Sunday won support from bank member countries for his strategy to lead the poverty-fighting institution for the next five years, including plans to give the private sector a bigger role in poor countries.

In a communique at the close of a day-long meeting, the bank's steering committee said tackling poverty in poor countries, especially in sub-Saharan Africa and in countries emerging from conflict, should be a priority.

The committee, which helps set World Bank policy on behalf of the member nations, also called for the institution to do more to help developing countries adapt to climate change and improve their access to clean energy sources.

"We welcomed the president's commitment to develop and refine the strategic framework in a consultative manner under the guidance of the bank board, and look forward to reviewing progress at our next meeting," the communique said.

The committee backed Zoellick's plan to work more closely with the private sector in efforts to pull poor countries out of poverty by generating growth and jobs.

"We emphasized the need to sharpen the focus of poverty reduction strategies on stronger, shared, private-sector-led growth," it said.

Defining A New Role

Zoellick, who took office in July, has won praise for quickly refocusing the bank's attention on combating poverty after an ethics scandal surrounding his predecessor, Paul Wolfowitz, that had rocked the institution and distracted it from its mission.

Wolfowitz, the controversial former deputy U.S. defense secretary and Iraq war architect, resigned in June over his handling of a raise and promotion for his companion, a women's rights specialist who worked at the bank.

In the lead up to bank's annual meeting this weekend, Zoellick had moved quickly to sketch out a new strategy, which he laid out in front of member nations on Sunday.

In addition to giving the private sector a bigger role in development, he said the bank should respond quicker to help countries emerging from conflict. He also said it should improve services for fast-growing emerging economies that no longer need loans, and said it should do more to fight disease and protect the environment.

But ensuring the institution is properly financed is one of Zoellick's biggest challenges. The World Bank is more than half way through tough negotiations with its biggest donors to replenish the coffer for lending to 81 of the poorest nations.

Zoellick challenged donors to increase their contributions to this fund -- the International Development Association -- noting the bank had already doubled the amount of money it pumps into IDA with funds from a profit-making affiliate.

"We need ... developed countries to translate their words from summit declarations into serious numbers too," he said.

The Development Committee said a strong IDA replenishment was necessary for the bank to help the poor.

"We underlined the need for a strong IDA replenishment to enable IDA to play its crucial platform role in the evolving aid architecture," the communique said.

The United States, which is the bank's biggest donor, on Sunday said the bank's limited resources meant it needed to bolster private-sector activity, because that is where jobs and growth are generated.

Still, U.S. Treasury Secretary Henry Paulson told the member governments the bank should be more selective in its lending. "World Bank engagement should be limited to programs that clearly meet its core mission of promoting economic growth and poverty reduction."

He made no mention of what the United States might be willing to do to top up funds for IDA lending.