Bush to seek able manager, reformer for World Bank

WASHINGTON, May 24 (Reuters) World Bank shareholder nations called for a more transparent process to select the next bank chief but stopped short of picking a fight with the US administration by demanding radical changes.

President George W Bush made clear in an interview with Reuters this week he wants an American to replace Paul Wolfowitz, who resigned over an ethics scandal involving a promotion and hefty pay rise he authorized for his companion.

The ordeal led some countries and development groups to call for a more democratic process for selecting the next bank president, saying a choice should be made on merits, irrespective of nationality.

In an informal agreement with Europe, the United States, the bank's largest shareholder, has selected the head of the World Bank since the institution's establishment six decades ago. Its sister organization, the International Monetary Fund, has always been led by a European.

Big European countries with seats on the World Bank's board have said they are not seeking to change those traditions.

Discussing a meeting yesterday of World Bank shareholder nations on the selection process, board officials told Reuters there appeared to be a reluctance even among other countries to push a White House already wounded by the loss of Wolfowitz, an architect of the Iraq war tapped by Bush to head the bank in 2005.

Brazil, South Korea, China and Pakistan were among a group of developing nations that called for a more transparent process for selecting the head of the bank, an institution funded by wealthy countries whose mission is to eradicate poverty in developing nations.

''Countries want to move toward a more inclusive merit-based global process but the prevailing sentiment is that the Americans have been very bruised by this and are not very responsive to be pressed harder,'' said one board official.

The Bush administration has offered few clues about the type of candidate it is seeking for the World Bank, but people close to the White House said it was seeking a capable manager who will also pursue the anti-corruption agenda that Wolfowitz made a centerpiece of his tenure.

''It is essential that anti-corruption be a priority,'' said White House spokesman Tony Fratto.

US Treasury Secretary Henry Paulson, who is leading the search, has promised to consult widely, in a signal Bush will avoid candidates who would stir controversy the way Wolfowitz, a former Deputy Defense Secretary, did in 2005.

TOP CONTENDERS The top contenders include former US Trade Representative Robert Zoellick, 53, and U.S. Deputy Treasury Secretary Robert Kimmitt, 59, according to Republicans sources.

Among other names mentioned are Stanley Fischer, 63, governor of the Bank of Israel; former Federal Reserve Chairman Paul Volcker, 79; former US Senator Bill Frist, 55, and US Commerce Secretary Carlos Gutierrez, 53.

White House chief of staff Joshua Bolten's name has also circulated. Bolten, 52, would bring financial experience as a former senior executive at Goldman Sachs International, but it is unclear whether Bush would want to part with him.

The next head of the World Bank faces the tough task of transforming a bureacracy-mired institution and positioning it to tackle new global challenges like climate change and the economic rise of countries such as China and India that are less interested in its money and more in its knowledge.

Republican sources, who spoke on condition of anonymity, said neither Fischer nor Volcker looked likely to get the job.

Nobel laureate Joseph Stiglitz told US lawmakers on Tuesday that if the World Bank is to be effective and a role model to countries it lends to, its governance -- namely the way its leader is selected -- must change.

Neither Zoellick nor Kimmitt are viewed by Europeans with the skepticism that greeted Wolfowitz.

REUTERS SZ PM0530