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The IDB chooses president among five candidates to turn the page

The Inter-American Development Bank (IDB) elects this Sunday a new president among candidates from Brazil, Mexico, Chile, Argentina and Trinidad and Tobago, to turn the page on troubled times.

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In a vote behind closed doors, the assembly of governors will choose between the Brazilian Ilan Goldfajn, head of the department for Latin America of the International Monetary Fund (IMF), the Mexican Gerardo Esquivel, deputy governor of the Central Bank, the Chilean Nicolás Eyzaguirre, former minister of Treasury and Education, the Argentine Cecilia Todesca Bocco, Secretary of International Economic Relations of the Foreign Ministry and the Trinidadian Gerard Johnson, former IDB official.

The person chosen by the institution’s highest authority will replace Mauricio Claver-Carone, elected in 2020 and dismissed in September for having given favorable treatment to an employee with whom he had an intimate relationship.

His tenure was marked by tensions with some of the governors, who are usually finance ministers or other economic authorities from the 48 member countries of the bank, and behind closed doors with part of the staff.

Hence, all the applicants applaud the fact that there are five candidacies from the region, as established by an unwritten rule that was broken with the appointment of Claver-Carone, and defend the need to calm things down through “dialogue.”

Founded in 1959 to contribute to the improvement of living conditions in the region, the IDB has become over time a source of financing for economic, social and institutional development in Latin America and the Caribbean.

For the Mexican candidate Gerardo Esquivel, the bank must return to its origins and recover “a very comprehensive vision of development” because “it is an institution that goes far beyond financing,” he declared.

They all think it is important to invest in the fight against inequalities and climate change and insist on the need to optimize the body’s resources before increasing capitalization.

According to the Chilean Eyzaguirre, the IDB is “a somewhat sleepy institution” that “is not making full use of its capacities” because from a financial point of view it is healthy. “It’s triple ‘A’, which is very important because it can collect funds very cheaply and redistribute them in the region in countries that have less access,” he explained.

headwinds

The Argentine Todesca Bocco agrees that the IDB “can transform or deepen its capacities as an instrument for the development of the region.”

The other point in which the five affect is the importance of communication with the assembly of governors.

“You have to have a dialogue with the assembly of governors, you have to guide us all, you have to say that this is where we are going and, together with the president, define how to get there,” explained the Brazilian Goldfajn.

Godlfajn was appointed by the outgoing president, the far-right Jair Bolsonaro, defeated at the polls by the leftist Luiz Inácio Lula da Silva, who has not made a public statement on the matter.

The new president will have to deal with an uncertain global economic context, with headwinds such as inflation, caused by the war in Ukraine, and rising interest rates.

The IDB must “refocus” because the crisis “has already started and we don’t know how long it will last,” affects “the most vulnerable, those who do not have a financial cushion” to cover emergencies, for example if they lose their jobs, said the candidate from Trinidad and Tobago, Gerard Johnson, at an event organized on Friday by the Atlantic Council think tank.

Master key

To be elected, the candidate must obtain an absolute majority of the votes of the 48 countries, whose voting power varies depending on the number of shares they have.

The bank’s three main shareholders are the United States, Argentina and Brazil, which together hold almost 53% of the voting power. It is followed by Mexico with 7.2%.

Washington alone already accounts for 30%, which makes the Joe Biden government one of the master keys of the election.

In addition, the winner must have the support of at least 15 of the 28 American countries (26 from Latin America and the Caribbean along with Canada and the United States).

For the election to take place, a quorum of governors is required for the entire session.

Source: Elespectador

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