Ajay Banga Confirmed as World Bank Leader
Mr. Banga’s appointment to a five-year term was confirmed on Wednesday by the World Bank.
Ajay Banga, President Biden’s pick to be president of the World Bank and broaden its ambitions to combat climate change, was approved by its executive board on Wednesday.
Mr. Banga will assume the job on June 2 and succeed David Malpass, who was nominated by former President Donald J. Trump and has served in the job for four years. A former chief executive of Mastercard who was raised in India, the incoming president will bring deep experience with developing economies and financial expertise to a global institution facing a critical moment of transition.
The approval by the bank’s board of 25 executive directors was not unanimous. Russia, which has been largely isolated in international forums since its invasion of Ukraine, abstained. Russia signaled in March that it was trying to find an alternate candidate, but ultimately Mr. Banga was the only nominee put forward.
The World Bank president is traditionally an American citizen who is chosen by the United States, while the managing director of the International Monetary Fund is chosen by the European Union.
Mr. Biden praised the board’s decision in a statement on Wednesday, expressing optimism that Mr. Banga would help steer the bank to address challenges such as climate change in ways that will make it even more effective in its mission to reduce poverty.
“Ajay Banga will be a transformative leader,” Mr. Biden said, “bringing expertise, experience and innovation to the position of World Bank president.”
Treasury Secretary Janet L. Yellen, who was an early proponent of Mr. Banga’s candidacy within the Biden administration, said she expected the incoming president would extend the bank’s reach by building new partnerships between governments and the private sector. She added that she expected to see a “staged adoption of reforms” over the course of the next year.
“Ajay understands that the challenges we face — from combating climate change, pandemics, and fragility to eliminating extreme poverty and promoting shared prosperity — are deeply intertwined,” Ms. Yellen said. “He has effectively built a broad global coalition around his vision for the bank over the course of his candidacy.”
Mr. Banga will face high expectations and urgent questions about whether the bank will change its lending model, whether it will seek more money from shareholders and how it should address issues including poverty, global warming and the war in Ukraine. He will also face a challenging diplomatic environment, trying to satisfy the climate ambitions of the United States while maintaining the bank’s focus on development. And he will have to navigate a delicate relationship with China, a major shareholder and creditor that has been facing international pressure to allow poor countries to restructure their debts.
The leadership change comes at a fraught time for the global economy, which has been gripped by a pandemic, inflation and war in the past three years. Those colliding crises have sent millions of people into poverty and reversed decades of development progress.
The bank’s backing of Mr. Banga, who was tapped by Mr. Biden in February, followed an extensive listening tour that included visits to eight countries and dozens of meetings with government officials around the world.
The withheld support from Russia made the voting process an unusual one and underscored the friction that its war in Ukraine has created within international institutions.
Biden administration officials declined to comment on how Russia voted and said they were confident that Mr. Banga would assume the job with a strong mandate and robust support.
Mr. Banga is being appointed to serve a five-year term. His predecessor, Mr. Malpass, announced earlier this year that he would step down following criticism that he was not sufficiently committed to revamping the World Bank’s climate agenda.