Kristalina Georgiewa remains in office, the leadership crisis at the International Monetary Fund (IMF) is over, the top bodies have “full confidence” in the boss. If you didn’t know better, you’d have to assume that Tuesday’s IMF announcement was satire, a nasty little tip. Because if the 190 member states of the fund no longer have one thing in Georgieva after weeks of suspicion, then it is full of confidence. The allegations against the 68-year-old, who is said to have been involved in data manipulation in favor of China during her time as chief executive of the World Bank, are too serious.
Still, it was right to hold on to Georgieva. Because there were indications that she was involved in the alleged deal in which the People’s Republic agreed to the long-awaited increase in the World Bank’s share capital and was presented in an exaggeratedly positive manner in the institution’s once-renowned Doing Business Report. But there was no solid evidence. In addition, the IMF boss vehemently denies all allegations that a law firm has brought against her. In the end there was testimony against testimony, and that means: in case of doubt, for the accused.
If the IMF were suspected of being commercially viable, it could stop working
Nothing is over, however, because the week-long dispute has damaged the reputation of the IMF and the World Bank, but above all that of the incumbent fund manager – perhaps even irreparably. The correct economic analysis, the purely fact-based, absolutely incorruptible elaboration of economic reports and forecasts are among the core tasks of the sister institutions. Government development aid payments, private investments, and even the fate of governments depend on the data. If the IMF were even suspected of being traded in here or even being ready to do business – it could stop working.
It also weighs heavily that the USA, of all people, the largest shareholder with power, urged Georgievas to be expelled. How should that close, intensive cooperation between the IMF boss and the US government be possible in future, without which the fund would be practically paralyzed? Such a paralysis would be devastating, especially in times of a global health crisis, because even if you don’t notice it in the rich West: In large parts of the world it is more or less solely the IMF and the World Bank that the governments in the fight against the pandemic and its economic Support consequential damage.
Perhaps the US was just trying to divert attention from Kim’s responsibility
But the dispute has also damaged the USA and the Europeans, who have jealously wrestled for influence at the IMF and World Bank for decades. It is very noticeable, for example, that the USA declared Georgieva to be guilty of the affair from the start, while the name Jim Yong Kim hardly appeared. There are also indications that the manipulations could have been hatched in the office of the American citizen Kim, who, as the then World Bank president, was the boss of the Bulgarian woman. And maybe it annoys the USA that Georgieva opened the fund even further to developing countries, especially during the pandemic, putting the World Bank, with its current American President David Malpass, in the shade.
On the other hand, the support of the Europeans for the IMF boss is fed less from full trust and appreciation for her overall good work with the fund, but more from necessity: The EU states had not only put Georgieva into office in 2019, they would have Rather, if you are kicked, you have to fear losing your customary law once and for all, according to which the fund is always run by a European.
Either way, the fact remains: A highly political deal with China, as it probably took place at the World Bank, is not being engineered by petty officials. On the contrary, it is very likely that Kim’s or Georgieva’s office knew about it – or even the bosses personally. In this respect, the decision to keep the IMF boss in office is nothing more than a second-class acquittal. In other words: an acquittal full of suspicion.