Writethru: Wolfowitz to Resign As World Bank Chief By End of June

Writethru: Wolfowitz to resign as World Bank chief by end of June

WASHINGTON, May 17 (Xinhua) — Besieged World Bank President Paul Wolfowitz will resign by the end of June, both Wolfowitz and the bank said on Thursday.

“I am announcing today that I will resign as President of the World Bank Group effective at the end of the fiscal year, namely June 30, 2007,” said Wolfowitz in a statement.

The 63-year-old leader, who had fought the pressure to resign for weeks, said he has concluded that “it is in the best interests of those whom this institution serves for that mission to be carried forward under new leadership.”

Meanwhile, the World Bank executive board said in its own statement that the institution has accepted Wolfowitz’s decision to step down.

“The executive directors acknowledge Mr. Wolfowitz’s decision to resign as president of the World Bank Group, effective end of the fiscal year (June 30, 2007),” said the statement.

World Bank officials said earlier that Wolfowitz, former U.S. deputy defense secretary, insisted that he will resign voluntarily and the bank should share some responsibility for his pay-and- promotion package for Shaha Riza.

Shaha Riza, Wolfowitz’s girlfriend and once a staff member in the bank, was transferred to the U.S. State Department when Wolfowitz took over at the World Bank in 2005, to avoid any conflict of interest.

While still on the World Bank payroll, Riza was rapidly promoted and ended up with a tax-free salary to about 193,000 dollars, more than even Secretary of State Condoleezza Rice receives before tax.

Pressure on Wolfowitz to resign has grown since a panel report released on Monday concluded Wolfowitz has placed himself in a conflict of interest situation over the Riza’s assignment and pay package.

“He should have withdrawn from any decision-making in the matter,” said the report, adding the informal advice provided by the World Bank ethics committee was not a model of clarity.

The panel recommended the bank’s 24-member board to “consider whether Mr. Wolfowitz will be able to provide the leadership needed to ensure that the Bank continues to operate to the fullest extent possible in achieving its mandate.”

However, Wolfowitz responded immediately on Monday that the report was unfair and unwarranted.

“It is highly unfair and unwarranted to now find that I engaged in a conflict of interest because I relied on the advice of the ethics committee as best I understood it,” he said.

“Rather than fix blame for something that wasn’t wrong, we should all acknowledge our responsibility as I have acknowledged mine,” he emphasized in a statement to the board on Tuesday.

In a statement announcing his resignation on Thursday, Wolfowitz also noted that he was pleased the World Bank executive board “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.”

As a result of the controversy, the World Bank board pledged to review the World Bank’s ethics policies, noting that “the bank’s systems did not prove robust to the strain under which they were placed.”

“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,” said the executives in a statement

The Bush administration, which had voiced unwavering support for Wolfowitz until the last minute, expressed its regret for Wolfowitz’s decision to step down, saying the besieged World Bank chief was a good man.

“The president will have a candidate to announce soon, allowing for an orderly transition that will have the World Bank refocused on its mission,” said White House spokesman Tony Fratto.

“We would have preferred that he stay at the Bank, but the president reluctantly accepts his decision,” he added.

The World Bank executive board also said it will start the nomination process for a new President immediately.

By tradition, the United States names the World Bank chief while Europe nominates the leader of the International Monetary Fund. The U.S. media reported that Bush would choose an American to replace Wolfowitz.

(c) 2007 Xinhua News Agency – CEIS. Provided by ProQuest Information and Learning. All rights Reserved.