MercoPress. South Atlantic News Agency

World Bank begins nomination process to replace Wolfowitz

Wolfowitz resign will be effective at the end of the fiscal year

The World Bank Board announced late Thursday that President Paul Wolfowitz will resign June 30, putting an end to his two year controversial tenure finally undermined by the generous compensation he arranged for his girlfriend.

However in the resignation announcement the WB admits Mr. Wolfowitz acted ethically and in good faith in what he believed was the best interest of the institution. Actually his departure was virtually forced by the finding of a special panel that he violated conflict-of-interest rules in his handling of the 2005 pay package of bank employee Shaha Riza with whom he was linked sentimentally. "Over the last three days we have considered carefully the report of the ad hoc group, the associated documents, and the submissions and presentations of Mr. Wolfowitz. Our deliberations were greatly assisted by our discussion with Mr Wolfowitz. He assured us that he acted ethically and in good faith in what he believed were the best interests of the institution, and we accept that. We also accept that others involved acted ethically and in good faith". "At the same time, it is clear from this material that a number of mistakes were made by a number of individuals in handling the matter under consideration, and that the Bank's systems did not prove robust to the strain under which they were placed. One conclusion we draw from this is the need to review the governance framework of the World Bank Group, including the role as well as procedural and other aspects of the Ethics Committee". The Executive Directors accept Mr. Wolfowitz's decision to resign as President of the World Bank Group, effective end of the fiscal year (June 30, 2007). The Board will start the nomination process for a new President immediately". Wolfowitz's nomination two years ago was marked by controversy from the start, given his previous role as a major architect of the Iraq war when he served as the No. 2 official at the Pentagon. In spite of the internal findings the White House supported Mr. Wolfowitz all along and the careful wording of the final release indicates an agreement was reached for an attempted dignified exit. In his resignation statement Mr Wolfowitz emphasizes he acted ethically and in good faiths. "I am pleased that after reviewing all the evidence the Executive Directors of the World Bank Group have accepted my assurance that I acted ethically and in good faith in what I believed were the best interests of the institution, including protecting the rights of a valued staff member". "To do that, I have concluded that it is in the best interests of those whom this institution serves for that mission to be carried forward under new leadership. Therefore, I am announcing today that I will resign as President of the World Bank Group effective at the end of the fiscal year June 30, 2007".