Pressure grows on Wolfowitz ahead of board decision

WASHINGTON, May 9 (Reuters) The battle over Paul Wolfowitz's leadership of the World Bank moved toward its end game today as Germany reiterated its call for him to quit and the United States urged that he be given due process.

The World Bank's 24-nation board will meet on Friday to decide Wolfowitz's fate over a pay and promotion deal he approved for his companion, Shaha Riza, a bank West Asia expert, which unleashed widespread anger among bank staff and prompted an investigation.

Karin Kortmann, a state secretary for German development ministry, said Development Minister Heidemarie Wiezorek-Zeul told Wolfowitz during the World Bank's spring meeting in April that she was worried about the credibility of the institution.

''She made it clear to (Wolfowitz) that his voluntary resignation was the best solution for the bank and its goals,'' Kortmann told lawmakers in German parliament today.

Kortmann said Germany, which chairs the World Bank board as well as this year's meeting of the Group of Eight industrial nations in June, was not looking for a confrontation with the United States and that pushing through any solution against US wishes would be difficult.

''The United States should rather be given room to react to the current leadership crisis in the bank,'' Kortmann added.

The White House, which yesterday deferred questions over Wolfowitz matter to the US Treasury Department, insisted on Wednesday it was not ''hanging Paul Wolfowitz out to dry'' and that he had the administration's full support.

''We still support him fully,'' White House spokesman Tony Snow told reporters on board Air Force One as he flew with President George W. Bush to visit parts of Kansas devastated by tornadoes last week.

The Treasury is officially responsible for US World Bank policy, but Wolfowitz is strongly identified with the White House because he was deputy defense secretary and had a leading role in the planning of the Iraq war.

DUE PROCESS The White House today gave what has become an almost daily endorsement of Wolfowitz, appealing for more time for him to defend himself against a 600-page report by a bank committee that found he violated bank rules in promoting Riza.

''We're in the middle of a process right now where Paul Wolfowitz has been given the opportunity to respond to a recommendation,'' White House counselor Dan Bartlett told reporters.

''Obviously we support Paul Wolfowitz and the agenda he's pursued at the bank,'' Bartlett said. ''We are hopeful that he does get a fair hearing.'' European ministers in April sought a meeting with US Treasury Secretary Henry Paulson hoping for a resolution to the then growing controversy around Wolfowitz.

All Paulson has said publicly is that Wolfowitz deserves ''due process'' from the bank's investigatory panel. That position was repeated yesterday by Treasury spokesperson, Brookly McLaughlin, who said Wolfowitz should be given sufficient time to respond to allegations, which under bank rules means five days and could delay the Friday meeting of the board.

A French Foreign Ministry spokesman said in a briefing that it was essential the investigation progressed quickly.

''We hope that the board meets quickly to say, on the basis of this report and observations, what Mr Wolfowitz could do,'' spokesman Jean Baptiste Mattei said.

Other European countries including Norway, Switzerland, the Netherlands, and France have voiced concern over the impact the scandal has had on the World Bank's anti-poverty mission.

The United States and European nations have the biggest stakes in the World Bank and are the institution's largest financial backers. World Bank member countries in Asia, Latin America and Africa have been mostly silent over the issue.

Reuters JK SBA VP0128