September 24, 2023

With her future uncertain, embattled IMF managing director Kristalina Georgieva releases statement: I did not pressure anyone to alter any reports

Managing Director Kristalina Georgieva meets staff on her first day at the IMF in October 2019 and takes part in FaceBook Live interview
Managing Director Kristalina Georgieva meets staff on her first day at the IMF in October 2019 and takes part in FaceBook Live interview

With her future now uncertain, the managing director of the International Monetary Fund (IMF) Kristalina Georgieva released a statement on Friday, denying any wrongdoing, after the findings of an independent probe concluded that she helped boost China’s global ranking in a 2018 world economies report while she was World Bank head.

“Out of respect for due process, I have refrained from addressing many of the questions that have been raised about the 2018 Doing Business report at the World Bank and will continue to do so until I meet with the board of directors at the International Monetary Fund. It is important, however, to at least elaborate for the public and for the sake of the staff of the IMF why I disagree with the investigative report’s conclusions with respect to my role in the Doing Business 2018 report,” the Bulgarian economist wrote in a statement. 

She added, “Let me be clear: the conclusions are wrong. I did not pressure anyone to alter any reports. There was absolutely no quid pro quo related to funding for the World Bank of any kind. Reviewing the integrity of these reports was within my professional responsibilities at that time, and, unlike what has been reported, I followed all protocols for editing the report. The methodology used in the Doing Business report has been the subject of concerns over many years. Like others in the World Bank before and since, I fundamentally viewed my role as overseeing the protection of the integrity of the report’s methodology, not its technical implementation. 

“The senior director of the 2018 report has come forward to make clear that I did not pressure him to change the report or its rankings and that the investigative report failed to include much of what he told them. The truth is, I asked the team to triple check its findings to ensure accuracy – period. Data integrity is core to the institutions that I have led over my public service career, and I would never be party to any alteration of data for political purposes.

“I stand by my years of experience in promoting good governance and advancing integrity and equity in international institutions. I have a 40-year track record as an economist and I have always approached my work and my colleagues with integrity—in academia, at the World Bank, and the IMF. As the world faces an urgent and complex set of challenges, from COVID to inclusive growth, from climate change to gender and racial equality, our work at the IMF has never been more vital. I will continue to focus on delivering on our mandate for our partners in Africa, Asia, Europe, Latin America and North America.

“As much as I have strived to be open and inclusive, I was very sorry to learn that some staffers felt their concerns were not heard. Moving forward, I will make sure to be even more attentive to hearing staff views. And I will make sure we have accessible channels for our colleagues to express those views. A robust exchange of ideas and opinions is essential to a strong work environment. 

“I look forward to briefing the IMF Board about these issues soon.”

The Executive Board of the International Monetary Fund (IMF) met on Tuesday for an initial briefing from the Ethics Committee on the matter related to Managing Director Kristalina Georgieva’s alleged role in the World Bank’s Doing Business 2018 as described in the Investigation’s Report.

“The Board discussed the Ethics Committee’s deliberations so far and had a preliminary exchange of views on the report and the Managing Director’s statement in response to it,” IMF spokesperson Gerry Rice said in a statement. “The Executive Board emphasized the importance it attached to conducting a thorough, objective, and timely review and agreed to meet again soon for a further discussion.”

The future of Georgieva has been uncertain since an investigation into manipulation of an annual World Bank report found that the bank’s former chief executive directed staff to inflate China data.

More specifically, Georgieva was called out on Thursday by her previous employer, the World Bank, for applying pressure on staff to alter data to boost China’s position in a ranking economies.

The World Bank said in a review released in December that China’s position in the 2018 report (ease of doing business report), which was released in October 2017, should have been at number 85, seven places lower than number 78 which is where China ended up featuring.

In a statement received by Today News Africa in Washington D.C. on Thursday, Georgieva disagreed with the findings, which were compiled by an outside law firm at the direction of the World Bank.

The Managing Director of the World Bank is David Malpass who was appointed by former President Donald Trump and came into office about the same time as Georgieva was moving to the IMF.

In a statement on the Report on Investigation of Data Irregularities in Doing Business 2018 and Doing Business 2020, Georgieva said she disagrees ‘fundamentally’ with the ‘findings’ and ‘interpretations’ of the investigation, adding that she has already had an initial briefing with IMF’s Executive Board on the matter.

“I disagree fundamentally with the findings and interpretations of the Investigation of Data Irregularities as it relates to my role in the World Bank’s Doing Business report of 2018. I have already had an initial briefing with the IMF’s Executive Board on this matter,” she said.

In its report released on Thursday, the World Bank said the changes to China’s data in Doing Business 2018 report appear to to be the product of “two distinct types of pressure applied by the bank leadership on the Doing Business team.”

The World Bank said Georgieva, along with an adviser pressured the Doing Business team to “make specific changes to China’s data points in an effort to increase its ranking at precisely the same time the country was expected to play a key role in the bank’s capital-increase campaign.”

The United States Treasury Department said it was reviewing the report. The Treasury Department manages U.S. engagement with the IMF and the World bank.

The United States has the biggest voting power in both the IMF and the World Bank and the Biden administration could decide whether Georgieva, a Bulgarian economist will remain as head of the IMF or be ousted.

Bloomberg noted that “The Doing Business report plays a notable role in emerging markets, with governments often showcasing moves up in ranking in appeals for foreign investment. But the integrity of the ratings has been the source of heated debate in recent years. Paul Romer quit in 2018 as the World Bank’s chief economist after questioning changes to Chile’s order in the report.”

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