MasterCard President and CEO Ajay Banga speaks on the US-Africa Business Forum in Washington, Aug. 5, 2014.
Drew Angerer | Bloomberg | Getty Images
U.S. President Joe Biden on Thursday nominated former MasterCard CEO Ajay Banga to grow to be president of the World Bank, hailing his business experience in his native India and his commitment to mobilizing private funds to expand financial inclusion and help developing countries grapple with climate change.
The World Bank on Wednesday said it expects to pick out a recent president by early May to exchange David Malpass, who announced his resignation last week after months of controversy over his views on climate change and pressure by Treasury Secretary Janet Yellen for him to adopt “bolder and more imaginative” reforms.
Scott Morris, a senior fellow on the Center for Global Development and a former U.S. Treasury official, said: “I feel the speed of the nomination, lower than 48 hours after the WB board launched the method, reflects a desire to discourage any challengers and wrap it up quickly.”
Biden’s nomination of Banga, 63, now a U.S. citizen, all but assures he’ll assume a job that oversees billions of dollars of funding, putting someone with close ties to emerging markets on the helm of the bank because it races to higher help developing countries address climate change and other pressing challenges.
“Ajay is uniquely equipped to steer the World Bank at this critical moment in history,” Biden said in a press release. “Raised in India, Ajay has a singular perspective on the opportunities and challenges facing developing countries and the way the World Bank can deliver on its ambitious agenda to cut back poverty and expand prosperity.”
Biden singled Banga’s many years of experience constructing global firms and constructing public-private partnerships to tackle urgent challenges comparable to climate change, and said he had a proven track record working with global leaders.
Banga’s work in India and other emerging markets, his “obsession” with expanding financial inclusion, and his deep knowledge of latest technologies could help bridge the growing divide between wealthy countries and emerging markets, said Luis Alberto Moreno, who worked closely with Banga while serving as president of the Inter-American Development Bank.
“He can really be a force for change,” Moreno said, noting that Banga enjoyed the trust of monetary markets whose support was urgently needed to assist raise the trillions of dollars needed to take care of global challenges.
Diversity
The bank has historically been headed by someone from the USA, its largest shareholder, while a European heads the International Monetary Fund (IMF), but developing countries and emerging markets have pushed to widen those selections.
Banga’s nomination is the primary to be made public, however the bank will accept nominations from other member countries through March 29. Germany, one other major shareholder, this week said the job should go to a girl because the bank has never been headed by a girl in its 77-year history.
A senior U.S. administration official said they didn’t know if other countries would nominate candidates for the post.
Asked about Washington’s decision to skip nominating a girl, the official said Banga had “a private conviction and excellent track record promoting diversity, equity and inclusion within the work that he does” and would bring that view to the bank.
But Jeff Hauser, who heads the progressive Revolving Door Project, demanded Biden retract the nomination of a top official from a “rapacious international private equity firm” who had previously only worked in private sector firms.
“Neither private equity, nor MasterCard, nor Citigroup, nor PepsiCo, nor Nestlé, nor Dow promote shared prosperity. All of them do vastly more to exacerbate inequality than to fight it,” he said in a press release.
Oxfam International said the following bank president ought to be chosen through a transparent global process. “The World Bank shouldn’t be a U.S. bank, a industrial bank, or a non-public equity firm. For a job of this stature, we want greater than a faucet on the shoulder from President Biden.”
Banga, born right into a Sikh family in India, is vice chair of General Atlantic, a U.S. private equity firm that administration officials said has invested over $800 million in EV charging solutions, solar energy and sustainable farming. He also serves as honorary chair of the International Chamber of Commerce.
He retired in December 2021 after 12 years on the helm of Mastercard Inc (MA.N), where he helped 500 million unbanked people join the digital economy, averted layoffs of the bank’s 19,000 employees through the COVID-19 pandemic, and led work on climate, gender and sustainable agriculture.
Vice President Kamala Harris said Banga brought “great insight, energy and persistence” to his role as co-chair of the Partnership for Central America, which has mobilized $4.2 billion in public, private and non-profit funds to advance economic opportunity in Northern Central America.
Treasury’s Yellen said Banga clearly understood the importance of retooling the bank to assist developing countries address climate change, prepare for future pandemics and mitigate the causes and consequences of conflict and fragility.
“Mr. Banga’s track record of forging partnerships between the general public sector, private sector, and non-profits uniquely equips him to assist mobilize the private capital and press for the reforms needed to satisfy our shared ambitions,” she said.
Biden’s climate envoy John Kerry said Banga brought the “recent considering and artistic vision regarding finance” needed to satisfy the challenge of the energy transition.
