The IMF Executive Board reaffirmed on Monday (11 October) its “full confidence” in the Washington-based crisis lender’s chief, Kristalina Georgieva, keeping her on as managing director after she was hit with allegations of data tampering.
“Having looked at all the evidence presented, the Executive Board reaffirms its full confidence in the Managing Director’s leadership and ability to continue to effectively carry out her duties,” the institution’s governing body said.
An investigation by law firm WilmerHale has concluded that the Bulgarian economist manipulated data in favor of China while in a senior role at the World Bank.
WilmerHale’s controversial findings center on the drafting of the 2018 and 2020 editions of the World Bank’s report ranking countries according to their ease of doing business.
The push came while bank leadership was engaged in sensitive negotiations with Beijing over increasing the bank’s lending capital.
The IMF board said it “considered that the information presented in the course of its review did not conclusively demonstrate that the Managing Director played an improper role regarding the Doing Business 2018 Report when she was CEO of the World Bank.”
Georgieva welcomed the decision, saying the allegations were “unfounded.”
“This has obviously been a difficult episode for me personally,” said the 68-year-old, who took the helm of the International Monetary Fund in October 2019 after Christine Lagarde departed to lead the European Central Bank.
“I want to express my unyielding support for the independence and integrity of institutions such as the World Bank and IMF; and my respect for all those committed to protecting the values on which these organizations are founded,” she said in a statement.
“I am pleased that after a comprehensive, impartial review of the facts, the IMF Board agrees that the allegations were unfounded. I want to thank the Board for expressing its full confidence in my leadership,” she added.
“Trust and integrity are the cornerstones of the multinational organizations that I have faithfully served for more than four decades.”
The investigation has deeply divided the 24 members of the IMF’s Executive Board.
While France, Britain and other European countries expressed their support for Georgieva, the United States has been more reluctant to keep her in post.
It was only at the end of nearly four weeks of discussions that Washington joined the Europeans in agreeing to retain Georgieva.
The 68-year-old took the helm of the Washington-based crisis lender in October 2019 after Christine Lagarde departed to lead the European Central Bank.
She was the only candidate to lead the IMF, which traditionally is led by a European while the World Bank is headed up by an American.
But the institution had to change its bylaws to approve her appointment, since she was over the 65-year age limit.
Until then, she had spent most of her career at the World Bank, even becoming its chief executive in 2017.
A native of Sofia, she taught economics there for 26 years, and built up environmental experience with a focus on agriculture and sustainable development.
Her main priorities at the IMF have been fighting inequality and climate change, as well as better integrating women into the economy.
When Georgieva took the reins of the International Monetary Fund, the global economy had been weakened by the trade tensions between the United States and China.
Described by her supporters as unimpeachably honest, the allegations against her from an investigation done by an outside law firm have come as a surprise.
Georgieva is “a bold leader in confronting the economic fallout of the pandemic, as well as in positioning the fund as a global pioneer on climate change,” US economist and Nobel laureate Joseph Stiglitz wrote following the release of the investigation’s findings last month.
Other backers have pointed to her campaign to increase the IMF’s reserves to amplify its lending ability to poor countries.
Jeffrey Sachs, director of the Center for Sustainable Development at Columbia University, wrote in the Financial Times that Georgieva risks becoming a victim of “anti-Beijing hysteria,” amid claims by some Washington politicians that China interferes with multilateral institutions.
In addition to her duties at the World Bank and IMF, Georgieva served as European Union commissioner for aid and crisis management from 2010 to 2014, taking over for Bulgaria’s original candidate at short notice.
In 2014, she became European Commission vice-president for budget and human resources.
“She is tenacious and will not give up when fighting for an issue she really cares about,” one Brussels diplomat recalled of her time there.
In 2016, she was a surprise finalist in the election for the post of UN secretary general, which in the end went to Portugal’s Antonio Guterres.
Georgieva was born behind the Iron Curtain in Sofia, capital of communist Bulgaria, on August 13, 1953, the year Soviet leader Joseph Stalin died.
Her father Ivan was a road construction technician and mother Minka worked as a shop manager, ignoring her husband’s advice not to work because of her heart condition.
Georgieva’s mother, who died in 2014 at age 93, told local media that as a child, her daughter was “far too quiet” and always had her nose in a book from the moment she could read.
The married mother of one is fluent in Russian and built good relations with Moscow during her years as the World Bank’s director in the country between 2004 and 2007.