|
Relief As Wolfowitz Calls an End to Uneasy World Bank Tenure |
|
|
|
Written by Richard Dukes
|
|
Sunday, 20 May 2007 |
World Bank President Paul Wolfowitz resigned from his post Thursday ending a bitter row over his role in allotting huge pay hikes to girlfriend Shaha Riza.
The former US deputy Defense Secretary agreed to step down June 30 after the 24-member World Bank board accepted his explanation that he had acted in good faith during the whole fiasco.
Wolfowitz's resignation followed a ruling by a World Bank panel that he had violated the institution's laws in granting tax-free pay rises to World Bank Middle East expert Shaha Riza, who is his partner.
The issue began in 2005 when Wolfowitz was appointed World Bank President by the Bush administration. He immediately reported to the Bank's ethics committee he was having a relationship with one staff member called Shaha Riza. The ethics committee concluded there would be a conflict of interest and proposed Shaha Riza be relocated to a position where she would not be under his direct supervision.
However before the ethics committee could make specific recommendations, Wolfowitz had Riza moved to the State Department with an effective pay rise of $50,000 taking her total remuneration under the World Bank aegis to $180,000 from $130,000.
The issue appeared to be resolved at that time with the chairman of the ethics committee Ad Melkert writing to him and commending his actions. Mr Melkert also told Wolfowitz he could consider the matter closed.
However in January 2006, a person by name John Smith sent an e-mail to the Bank saying Wolfowitz had acted unethically in the matter. However Ad Melkert and his ethics committee once again cleared Wolfowitz of any wrongdoing.
The 63-year-old Wolfowitz was placed on the spot once again in March this year when the Washington Post reported Riza's salary had risen to "$193,590, which is $7,000 more than Secretary of State Condoleezza Rice makes". In the meantime Riza had moved to an organization called Foundation for the Future.
But this report raised a furor with Bank employees calling for Wolfowitz' head. the White House defended its appointee strongly saying it believed he did no wrong. However growing pressure among financial circles especially from Europe forced the Bank to constitute an ad hoc panel to review the issue once again.
Wolfowitz apologized on April 12 admitting he made a mistake, but called the investigations a smear campaign. But his credibility was hugely affected since he had made corruption a central issue during his tenure at the Bank. The ad hoc panel also felt he had lost credibility.
The panel clearly felt Wolfowitz was in the wrong, but left his fate to the Board, which was looking to give the President a way out when he agreed to resign.
The White House has assured it would decide on his successor soon with the name of outgoing British PM Tony Blair doing rounds. However the Bank chief has traditionally been an American, but this time there could be an exception.
 Add as favourites (57)
Powered by AkoComment Tweaked Special Edition v.1.4.4 |
Finance 
