Lebanon withdraws World Bank nominee under pressure

Lebanon withdraws World Bank nominee under pressure
Source: www.devex.com
Date: 07-03-2019 Time: 09:03:01:am
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Ziad Hayek, an expert on public-private partnerships and former investment banker. Photo by: Lebanon2030

Lebanon has withdrawn its nomination of Ziad Hayek to be the next World Bank president.

Hayek told Devex on Monday the Lebanese government made its decision because of “pressure” from other governments.

“I received some bad news today that the Lebanese government has withdrawn my nomination, but I’m continuing to fight on, still hoping that another party might nominate me instead,” Hayek told Devex.

“There was pressure on the Lebanese government from other governments to withdraw my nomination,” he said.

Lebanon’s minister of finance nominated Hayek, an investment banker and expert on public-private partnerships, on Feb. 18. While the World Bank’s board of executive directors promised an “open, merit-based and transparent” process, Hayek was the only known challenger to the Trump administration’s nominee, David Malpass, a U.S. treasury official.

While he has lost Lebanon’s backing, Hayek remains hopeful that another World Bank executive director will put his name forward before the March 14 nomination deadline.

“I’m hoping that there will be some other channel, some other person that would be interested in seeing a proper process, which I think will be important for the bank, even important for the U.S. candidate Mr. Malpass, who, if he wins, it would be good to have done so through a legitimate process,” Hayek said.

Devex reached out to Hayek to learn about his views on the World Bank, his vision for leading the institution, and his motivation for running — topics that Hayek says he is disappointed to see overshadowed by the question of whether he will even remain a candidate. Devex has also requested an interview with Malpass.

Lebanon’s ministry of finance did not immediately respond to a request for comment.

Hayek did not intend to base his candidacy around a radical new vision for the bank. He said that he broadly agrees with the major strategy documents that the bank’s leaders have already laid down — including the strategy aimed at fulfilling the terms of the capital increase deal agreed to last year.

“I think that the challenges are going to come from areas that are not given enough attention in the current documents,” Hayek said. “This is where I come in.”

The first of those challenges is human migration.

“I’m not a wall builder; I’m a bridge builder. I was a boat refugee myself from Lebanon. During the war in Lebanon, my family went to Cyprus on a boat, then after going to Greece and France. Finally Mexico gave us asylum ... That’s how I learned Spanish,” Hayek said.

He thinks the bank should support a three-part response to migration that includes asylum and assistance to migrants, creating “bridges to a better life,” and combating corruption.

In addition, Hayek thinks the bank should deploy its financial instruments more effectively to help address the multi-trillion dollar infrastructure finance gap in developing countries. He thinks the multilateral development banks could be better coordinated to standardize their processes, and he believes the World Bank could issue more syndicated and tradable financial products to help create a better market for infrastructure investment.

Hayek also believes that many countries could do more to tap the potential of civil society — particularly when it comes to youth empowerment.

Hayek and Malpass share very similar professional backgrounds. In fact they overlapped at the investment firm Bear Stearns, where Hayek was a senior managing director until 2003 and Malpass was chief economist.

Hayek said that he has met Malpass, but the two mostly worked in different areas, with Hayek focused on emerging market investments.

“It’s nothing personal. I have great respect for Mr. Malpass. Why shouldn’t I?” Hayek said. “I just think I offer a different recipe that is worth taking into consideration. That’s all.”

Asked why he believed it was worth challenging the American nominee in the first place — given the historic precedent of America’s hold on the position — Hayek said he “didn’t know it was going to be like this.”

“When I started I believed that there was a system, a process — that I was just applying to be part of this process … I believed what the World Bank said — and their directors — about wanting an open process, that they are encouraging applicants. I bought into that,” he said.

Hayek hopes that he can continue to put his name and perspective forward so that another World Bank shareholder — who believes it’s important to have more than one candidate — might renominate him.

“Maybe I’m dreaming, but I like to believe in people doing the right thing,” he said.


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