Thursday, May 03, 2007

Europeans wary of Wolfowitz

Europeans wary of Wolfowitz
By Dan Bilefsky and Steven R. Weisman
Copyright by The International Herald Tribune and The New York Times
Published: May 2, 2007

BRUSSELS: Paul Wolfowitz, the embattled president of the World Bank who came to Brussels on Wednesday to mobilize world governments on education policy in the developing world, was forced instead to dodge questions about an intensifying ethics scandal.

The aim of the conference, at which the European Union played host, was to galvanize the international community to honor its promises to provide primary education to all children by 2015. But the meeting was overshadowed by questions about Wolfowitz's future, including a statement Tuesday by a former head of the bank's ethics panel that Wolfowitz had manipulated information in the controversy over his handling of a pay increase and a promotion for his companion, Shaha Ali Riza.

So guarded was the reception for Wolfowitz that Gordon Brown, Britain's chancellor of the Exchequer, canceled plans to appear on the podium with him at a news conference. British officials said publicly that Brown had decided to leave early to campaign in the Scottish elections. But privately they admitted that appearing side by side with Wolfowitz had become a political liability.

Wolfowitz initially escaped the hoard of reporters waiting to greet him at the entrance of the conference, held at the European Commission's headquarters, by entering the sprawling building through an underground garage. But at a news conference where former African child laborers discussed the importance of going to school and where Wolfowitz himself spoke movingly about his grandfather's lack of education, his discourse was disrupted by recurring questions about his stewardship.

Asked if he would resign and whether he was concerned the allegations against him were distracting from the bank's development goals, Wolfowitz stressed that the work of the bank was continuing.

"The work of the bank goes on," he said. "There are millions of poor people who depend on us, and we will continue that work. It's a matter of keeping promises made. We're talking about the long term, it goes beyond me."

But he sidestepped questions about his future, referring journalists to his testimony to a panel investigating his role in promoting Riza, for whom he helped arrange a pay raise, promotion and transfer to the State Department after he arrived at the bank in 2005. "The board is considering the issue," he said.

On Tuesday, two former top officials at the bank issued new statements disputing the contention of Wolfowitz that they and others knew about his actions on behalf of the woman, who had been employed at the bank for seven years when he joined. The officials' testimony exposed the extraordinary discord at the highest levels of the bank after Wolfowitz became president.

Ad Melkert, a former head of the bank board's ethics committee, who appeared before the committee investigating the affair, said Tuesday that Wolfowitz had broken staff rules when he intervened directly in personnel matters concerning Riza, even though he said he wanted no part in a deal to transfer her outside the bank. Melkert, a Dutch political figure active in the Labor Party in the Netherlands, said that instead of arranging for the salary and promotion package, Wolfowitz should have given the job in question to someone neutral.

Meanwhile, Roberto Danino, a former prime minister of Peru who was the bank's general counsel in 2005, said he had a falling-out with the new bank president over the handling of Riza's case. In testimony Monday, he said Wolfowitz's desire to maintain contact with Riza while both worked at the bank violated bank rules and that the president had acted "incorrectly" when he gave her a raise and promotion package that "far exceeded" what was necessary.

The appointment of a prominent neoconservative as World Bank president has long been viewed with suspicion in Europe, which has an important voting block on the bank's board and, as such, considerable influence over Wolfowitz's future.

At the time of his appointment in March 2005, countries like France, Sweden, the Netherlands and Switzerland expressed concern that rather than upholding the interests of the world's poorest nations, Wolfowitz would use his office to push President W. Bush's agenda. They also feared that one of the architects of the U.S. war in Iraq would bring autocratic tendencies to the bank.

But Wolfowitz succeeded in mollifying many of his European critics by adopting a conciliatory tone and casting himself as an international civil servant with a genuine passion for development.

On Wednesday, however, some European officials said their good will was being squandered by a scandal they feared was detracting from the bank's core mission.

A senior French official, requesting anonymity because he is not authorized to comment publicly on the bank, said France feared that the allegations against Wolfowitz threatened to undermine global development.

"France is very concerned about the consequences of this issue on the World Bank's mission at the service of development," he said, adding that Paris hoped that the bank's board would remove the uncertainty by deciding on Wolfowitz's future by next week.

A senior British official, also speaking on the condition of anonymity, said that the questions hanging over Wolfowitz threatened to "damage the bank." Hilary Benn, the British secretary of state for international development, warned two weeks ago in New York that the bank's credibility was at stake and called for the bank to overcome the impasse.

Development experts attending the education conference in Brussels said that Wolfowitz appeared tired, but determined.

"The question on everyone's lips wasn't if Wolfowitz will leave, but when," said Simon Moss, an Australian who works for the Oak Tree Foundation, a group focusing on education in the developing world. Pointing to the huge throng of reporters tailing Wolfowitz, he said it was a sad irony that there was more interest in the scandal at the bank than in the 77 million children not in school.

Steven R. Weisman reported from Washington.

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