World Bank to stop ‘ease of doing business’ report as probe finds ‘data irregularities’
The World Bank Group announced that it will be discontinuing “ease of doing business reports”. The bank has also released the findings of its probe into data irregularities that date back to 2018 and 2020.[1]
Founded in 1944, the World Bank Group (WBG, or Bank) and the International Monetary Fund (IMF, or Fund) are twin inter-governmental institutions that are influential in shaping the structure of the world’s development and financial order.
They were also known as the Bretton Woods Institutions (BWIs) and were initially created with the intention of rebuilding the international economic system following World War II (WWII).[2]
The key decisions leading to the establishment of both institutions were largely steered by the US, and to a lesser extent the UK, and during the post-war period the BWIs were significantly influenced by the US’s geopolitical strength.
While the institutions have had their fair share of controversies, over the course of its history, it was during President Trump’s tenure, the institutions were the target of his ire along with all other institutions such as UN, WHO, UNHCR, International Red Cross, etc.[3]
Mr. Trump’s primary objections stemmed from bureaucracy, political biases that shaped decision-making, corruption, and catering to advocacy groups.
It was in 2019, that both President Trump and Treasury Secretary Steve Mnuchin objected to World Bank funding China‘s low-cost loans and projects with progressive pullback[4]. Trump tweeted – China has plenty of money and why are we funding their projects and programs.
In 2020 as Covid gained traction, Trump targeted his Ire at WHO for not being forceful with China on COVID, not having the data, not investigating China, and making China accountable.[5]
Trump’s approach was to cut off aid to these central institutions and make them irrelevant. Institutions have not reformed post World War II and have been subject to political biases and manipulations.
During this period various agencies had also reported China’s deep reach, a global database that it had maintained of roughly 1.9 million members, who were in influential roles in government and institutions.
Trump had alleged that all the institutions that were targets of his ire had been breached by the Chinese.
To his credit, the latest findings only vindicate his observations.
World Bank leaders, including then-Chief Executive Kristalina Georgieva who is now the managing director of the International Monetary Fund (IMF), applied “undue pressure” on staff to boost China’s standing in the bank’s “Doing Business 2018,” according to an investigation related on Sept 16.
The report prepared by outside law firm WilmerHale at the request of the World Bank’s ethics committee implicates Georgieva and then-World Bank President Jim Yong Kim and casts a spotlight on China’s influence at the institution.[6]
According to The Epoch Times, the report found China’s boosting appeared to be “the product of two distinct types of pressure applied by bank leadership on the doing business team.”[7]
It said Georgieva and a key adviser had pressured staff to “make specific changes to China’s data points” and boost its ranking at a time when the bank was seeking China’s support for a big capital increase.[6]
World Bank employees also received “direct and indirect pressure” from senior staff in Kim’s office to change the report’s methodology to boost China’s score, likely under Kim’s direction, the report also said.
In response to the findings, the World Bank has decided to abandon the “Doing Business” series entirely, according to a statement, released Thursday[1]. The lender said the report “raised ethical matters, including the conduct of former Board officials as well as current and/ or former bank staff.”
The U.S. Treasury Department, which manages the dominant U.S. shareholdings in the IMF and the World Bank, said it was analyzing what it called the “serious findings.”
Will these institutions reform and will the findings have any material impact, or the power of China will continue to prevail?
Under the Biden Administration, he sees the reviving and establishing and using these global institutions as a vehicle for his Global Policy Agenda, on Developmental funding, Covid response, Climate Change funding programs, Nation-building (Afghanistan, Palestine, Iraq, African Nations, etc.).
Chinese influence is going to be only stronger and well-anchored under Biden with neither investigation nor reforms in place[8]. Have we not seen this in Covid? Welcome to the era of Chinese influence and direction.
Note:
1. Text in Blue points to additional data on the topic.
2. The views expressed here are those of the author and do not necessarily represent or reflect the views of PGurus.
References:
[1] World Bank to discontinue Doing Business report – Sep 17, 2021, ANI
[2] A BRIEF HISTORY OF – Bretton Woods System – Oct 21, 2008, Time
[3] What are the main criticisms of the World Bank and the IMF? – Jun 04, 2019, Bretton Woods Project
[4] Treasury Secretary Mnuchin says China should be ‘graduated’ from supportive World Bank loan program – Dec 05, 2019, CNBC
[5] Coronavirus: Trump accuses WHO of being a ‘puppet of China’ – May 19, 2020, BBC
[6] Georgieva pressured World Bank employees to favor China in report – ethics probe – Sep 17, 2021, Euro News
[7] World Bank Leaders, Including Now-IMF Chief, Pressured Staff to Boost China’s Ranking in Report, Investigation Finds – Sep 16, 2021, The Epoch Times
[8] How China is responding to escalating strategic competition with the US – Mar 01, 2021, Brookings
- World Bank Courts controversy - September 18, 2021
- China’s pervasive influence in just about everything - September 18, 2021
- The six point plan of Mr Biden and his ulterior economic agenda - September 10, 2021
Amazing how unconcerned and irrelevant Indian rulers, representing 125 Cr. people, were to the going ons in the world bodies, the sole objective for them to be in power was to feather their own nests out the hard earned money of the taxpayers and somehow get their near and dear ones appointed to the likes of WB, IMF etc. for the foreign posting and tax free salaries.
Sridhar Chityala Ji, in one of the DGIs with Sree Iyer you have passed a remark on 1.9 million Chinese sprinkled in pivotal roles in all the key institutions and agencies in all countries.
I do not trust FUNDBANK/ADB or rating agencies reports on the Indian Economy! We know the ground realities and the incumbent government ignores because the party believes that emotive issue will bring them back to power.
Donald Trump identified issues faced by the USA but by the time he started to act it was all over for him. Biden Harris were chosen and got elected by a design behind Trump’s back and surely Biden will use FUNDBANK global institutions to implement his devastating Global Policy Agenda. Who now his son Hunter may play a key role to demolish USA first.
Without a tooth paste and tissue paper imported into US from China Biden Harris Admin will not sit idle full of greed influencing a section of people supported by five big tech companies, two newspaper barons and half a dozen TV channels destabilizing the vibrant nation the USA. Biden’s AUKUS leaving France behind will lead US into a vortex.
BWIs may become Chinese poodles.
Just like Indian politicians sharing their bedrooms with Pakistan & China, similarly Americans also parked their illgotten wealth from corrupt deals in Chinese banks & now they are held as hostage, in return they allow China to enter American from all backdoors.