Wolfowitz to quit the World Bank
Paul Wolfowitz is to quit as president of the World Bank following a bitter promotion row involving his partner.
The global lending body said Mr Wolfowitz would step down on 30 June
and that it would begin the search for a successor immediately. Mr Wolfowitz faced widespread calls for his resignation
after being accused of a conflict of interest over a pay rise given to
ex-Bank employee Shaha Riza.
The former US deputy defence secretary joined the World Bank in 2005.
'Good faith'
In a statement, the World Bank said it had been assured by Mr Wolfowitz that he had "acted ethically and in good faith".
I have concluded it is in the best interests of those whom the
institution serves for that mission to be carried forward under new
leadership Paul Wolfowitz
But it acknowledged that a "number of mistakes" had been made in how Ms Riza's role and remuneration had been handled.
It added that it "regretted" that Mr Wolfowitz's achievements at the Bank had been "overshadowed by recent events".
In response, Mr Wolfowitz said his decision to resign was "in the best
interests" of the institution, which has more than 180 members
worldwide. Mr Wolfowitz has been under severe pressure for several
weeks, with a number of European politicians calling on him to step
down to prevent the Bank's credibility in tackling corruption worldwide
from being eroded. The White House strongly supported Mr Wolfowitz -
although experts believed its influence would not be enough to save his
position in the face of European hostility.
President George W. Bush said earlier on Thursday that he regretted the current situation.
Conflict of interest
Mr Wolfowitz faced calls to resign since details emerged about his role
in securing a pay rise for Ms Riza, who used to work at the bank. When Mr Wolfowitz was appointed to head the body, Ms
Riza was transferred to work for the US state department, to avoid any
conflict of interest.
But her salary rose quickly to about $193,000 (£98,000) - more than the
$186,000 that Secretary of State Condoleezza Rice receives before tax. A panel of World Bank found that Mr Wolfowitz had
provoked a "conflict of interest" by breaking its code of conduct and
violating the terms of his contract. As recently as Wednesday, Mr Wolfowitz's lawyer said
the 24-members of the Bank's board of directors would have to vote to
sack him if it wants him to leave.
The board is made up of representatives of the Bank's leading members including the US, UK, Japan, France and Germany.
The Bank gave no further details of its agreement with Mr Wolfowitz, who was appointed for a five-year term on 1 June 2005.
His contract states that he is entitled to a year's salary should he
resign or be removed from office as long as he served a year in the
job.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/6667975.stm
Published: 2007/05/17 23:05:08 GMT
© BBC MMVII
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