Zoellick nominated to head World Bank

In former U.S. Trade Representative Robert Zoellick, President Bush has found a veteran diplomat well known to members of Congress and governments around the world to replace the discredited Paul Wolfowitz at the World Bank.

“It’s really a brilliant appointment,” said Stuart Eizenstat, a former Treasury Department official during the Clinton administration. “It’s unfortunate it didn’t happen two years ago.”

{mosads}Many thought Zoellick had sought the World Bank post but was passed over for Wolfowitz in 2005, in part because he had accepted a request by Secretary of State Condoleezza Rice to serve as her deputy. That marked a rare occasion in which a presidential Cabinet member continued serving the president in a sub-Cabinet position.

Since leaving State last summer, Zoellick has worked as a managing director of Goldman Sachs, which some saw as an effort to gain Wall Street experience that might be attractive for a Treasury secretary candidate.

He also signed on as an adviser to GOP presidential candidate Sen. John McCain (R-Ariz.) after leaving the administration. Zoellick told the New York Sun last August that McCain’s campaign staffers thought he could help them put together information groups on economic and domestic policy.

Eizenstat called Zoellick’s appointment the best the administration had made in seven years, noting the unique combination of political and policy skills that would make him effective at the World Bank. “I think it will be very widely accepted in Europe,” he said.

That will be a key if Zoellick is to be successful. World Bank board members and staff lost all confidence in Wolfowitz after it emerged that he helped his girlfriend leave the World Bank for a higher-paying job at the State Department. Wolfowitz maintained that he had acted properly, and some Republicans in Congress said critics of the administration’s war in Iraq had used the issue as an excuse to force Wolfowitz out of his job.

In a statement praising the nomination, Senate Finance Committee ranking member Chuck Grassley (R-Iowa) said Zoellick should continue Wolfowitz’s campaign against corruption in World Bank beneficiary countries. “We can’t accept business as usual,” he said. “Paul Wolfowitz may have been railroaded out of his job, but his initiative must continue.”

President Bush also praised Wolfowitz’s work as he announced Zoellick’s nomination. He said Wolfowitz had helped steer more resources to the world’s poorest countries and instituted reforms to make sure resources were used wisely.

Under an informal deal, the U.S. selects the president of the World Bank, while Europe gets to choose the leader of the International Monetary Fund.

Eizenstat recently co-chaired a report on reforming multilateral institutions that recommended leaders be selected through elections on merit. However, if there were an election on merit, Eizenstat said Zoellick would win it.
   
Zoellick has extensive international experience as an official with both Bush administrations. As President Bush’s trade representative from 2001 to 2005, he helped launch the current round of World Trade Organization (WTO) talks in Doha, Qatar just months after the Sept. 11 attacks.

 The Central American Free Trade Agreement was negotiated under Zoellick, who also helped craft the final international deal allowing China to enter the WTO.

Zoellick joined other trade leaders at the Doha meeting in 2001 in agreeing to a landmark declaration that reaffirmed the rights of WTO members to issue compulsory licenses allowing the production of generic versions of patented drugs.
However, Zoellick has also been criticized by public health groups for promoting bilateral trade policies that sought to lock
in patent protections for the brand-name pharmaceutical industry.

“From a public health standpoint, Zoellick is a terrible choice for World Bank president,” said Paul Zeitz, executive director of the Global AIDS Alliance. In a statement, he called for the Bank’s board to reject Zoellick.

Zeitz praised the World Bank’s current policy of allowing countries to use Bank aid to purchase generic drugs, and the institution has defended the right of countries such as Thailand to issue compulsory licenses to secure access to generic drugs. But Zeitz said he feared such policies could change under Zoellick.

At the State Department, Zoellick helped negotiate a Sudan peace deal that later unraveled. He also handled policies on China, gaining experience and contacts that Eizenstat said could prove useful in his role at the World Bank.

Under President Bush’s father, Zoellick was the senior U.S. official in the negotiations for German reunification. He also served as White House deputy chief of staff and assistant to the president from 1992 to 1993.