IMF board backs Georgieva after review of data-rigging claims

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WASHINGTON (Businesshala) – The International Monetary Fund’s executive board on Monday expressed its full confidence in managing director Kristalina Georgieva after reviewing allegations that she pressured World Bank staff to change the data in China’s favor.

FILE PHOTO: International Monetary Fund (IMF) Managing Director Kristalina Georgieva speaks during a joint news conference at the end of the Summit on Financing African Economies in Paris, France May 18, 2021. Ludovic Marin / Poole via Businesshala / File photo

But Treasury Secretary Janet Yellen gave notice to Georgieva that she would closely monitor the IMF’s follow-up and evaluate any new facts or findings, and called for proactive steps to reinforce data integrity and credibility at the IMF. did.

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The fund’s 24-member board and the Treasury issued separate lengthy statements after a week-long marathon meetings on Georgieva’s actions as World Bank CEO, questioning her continued leadership of the IMF.

The claims were strongly denied by Georgieva, a Bulgarian economist and the first person in the developing country to head the fund. She welcomed the board’s support in a separate statement of her own and said she was happy that its members had agreed that the allegations against her were baseless.

“It’s obviously been a difficult episode for me personally,” she said. “However, I would like to express my unshakable support for the independence and integrity of institutions such as the World Bank and the IMF; and my respect for all those who are committed to protecting the values ​​on which these organizations are founded.”

Georgieva won the support of France and other European governments last week, but US and Japanese officials have pushed for a more thorough review of the allegations, according to sources briefed on the matter.

The issue was a damning report prepared by law firm WilmerHale for the board of the World Bank about data irregularities in the bank’s now-cancelled “Doing Business” report.

Firm’s report Here Alleged Georgieva and other senior officials applied “undue pressure” on bank employees to make changes to boost China’s ranking in the report, as if the bank was seeking Beijing’s support for a major capital increase. .

Georgieva vehemently denied Here The allegations, which date back to 2017, when she was the chief executive of the World Bank. She became the Managing Director of IMF in October 2019.

The board said the information presented during its review – which included meetings with Wilmerhall lawyers and Georgieva – did not conclusively demonstrate that it played an improper role in the Doing Business report.

European governments had sought a quick resolution ahead of this week’s annual meetings of the IMF and the World Bank, where Georgieva and World Bank President David Malpass are discussing global recovery from the COVID-19 pandemic, debt relief and efforts. Speed ​​vaccination.

The United States and Japan, the fund’s two largest shareholders, cautioned against premature reaffirmation of confidence in the IMF leader, one of the sources said.

‘legitimate issue’

Yellen spoke with Georgieva on Monday about the “serious issues” raised by the investigation and underscored her commitment to “uphold the integrity and credibility of the World Bank and the IMF,” the Treasury said in a statement.

While the report “raised valid issues and concerns,” the Treasury said it agreed with other board members that “in the absence of further direct evidence regarding the role of the managing director, there is no basis for a change in IMF leadership.” “

Yellen told Georgieva that the Wilmerhall Report showed shareholders the need to be vigilant in protecting the integrity of both institutions, and added that the IMF should renew its commitment to maintaining transparency and whistleblower protections.

No matter who is to blame for the changed data, current and former employees of both institutions say the scandal has tarnished their research reputation here, raising important questions over whether that work member- under the influence of the country.

Malpass declined to comment on the IMF process on Monday, but said the World Bank was working here to improve the integrity of its research, including hiring its chief economist, Carmen Reinhart, to head the bank’s 10-person senior management team. was included to form the part.

Reporting by Andrea Schallal; Additional reporting by David Lauder; Editing by Peter Cooney and Stephen Coates

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