EM: What is your message to the Latin American constituency?
JS: Fortunately they know me very, very well in the region. I have worked throughout the entire region and I do expect support coming from throughout the region. I have spoken to a number of governments already which have expressed support and have declared their intention to send letters of support to the World Bank. So I am counting on – and am grateful for – support that I expect from South America, from Central America and from the Caribbean.
It is very gratifying because it is a part of the world that I know very well and where I got my start as a practising economist and where I have a continuing strong interest. Indeed I am on my way to Chile in just a few days for continuing work in that country, where the president is a classmate of mine from Harvard and the finance minister is a star student of mine and a co-author of the leading macroeconomics textbook in Latin America. So this is a region I really like to spend a large amount of time in.
‘The challenge is to continue to prosper in what will be tougher and tougher global climatic conditions’
In terms of the challenges, fortunately most of the Americas are not trapped in extreme poverty although there are places like Haiti and pockets of poverty in other countries in Central America and the Andean region where the challenge is of extreme poverty that absolutely needs to be addressed.
For the rest of the region this is generally a middle income region with a lot of dynamism and of the areas of the challenge is to continue to prosper in what will be tougher and tougher global climatic conditions, so climate change issues and environmental change is extremely important and sustainability is the paramount issue I am sure I would work with many governments, developing renewable energy resources and low carbon energy systems is obviously something that will be extremely important for a lot of countries in the region. So those are the sort of the issues that would be key and would be part of my agenda.
EM: Ultimately your success will come down to whether you get the backing of the US administration. Have you talked to them and do you know whether such support is forthcoming?
I have spoken to the White House but I don’t know what the inside deliberations are. They didn’t expect me to be a candidate and I was not planning on it or having a long campaign and effort. I was not on their list until fairly late in the day so I am gratified that I have been able to speak to several senior officials and send a letter to the President. I am hoping, of course, for the US support but I am not sure where that stands.
EM: Do you have the skills and management experience to lead such a large and disparate organisation as the World Bank?
JS: I actually do a tremendous amount of management. It is not on the scale of the World Bank but it is on a large scale. The Earth Institute is a large organisation and it has a worldwide programme. At the same time as directing the Earth Institute for the past decade I have been a senior UN adviser on the Millennium development Goals so I am working in dozens of countries around the world.
‘I am in fact a manager and have been a manager for quite a long time’
I work with many governments and that means I am working with lots of development teams in different regions and I am very familiar with the specific on the ground problems – in a large number of cases as familiar as anyone is because I have been in this for quarter of a century looking at precisely these issues, managing development projects – the Millennium villages that operate in more than a dozen countries, a major effort engaging with governments as well as significant communities; lots of money being handled and so forth. So I am in fact a manager and have been a manager for quite a long time. If I were not I would not take this on.
I have a position as a thought leader at the United Nations which is very gratifying. I have been a professor for going on 32 years; I write books and articles and have many ways to have my ideas discussed. But I feel I have the management capacity, particularly because I believe right now that these issues are complex and require not only general skills but detailed knowledge on development to get things right.
And this is a point I am making and not everyone agrees [with me] but I think it is a case of getting right the problems of , for example if it is the poorest countries fighting disease, hunger and extreme poverty in the absence of basic infrastructure. And if it is the higher income and middle income countries, the challenge is of sustainability amid rapid large-scale urbanization. It is not general principles. It is in fact detailed knowledge, it is having been to grapple with these issues hands-on and really wrestle with them for many, many years; to have networks of people who are leaders in these areas – problem-solvers, business CEOs, head of civil society organizations, top scientists and heads of international organizations.
‘I feel equipped to do a good job. I would shudder to come to something like this as an amateur on these issues’
So I have been very much hands-on for a quarter of a century, very different from merely being an academic. That’s not how I should be understood about what I actually do. Day-to-day I do a lot of very specific problem solving with governments and private business and a lot of direct project management in order to get that done. I feel equipped to do a good job and, also know that I have worked very hard at this for a long time and it is not that easy – in fact it is pretty tricky. It is very hard to get the issues right and I think I have a pretty good track record. But what I do know is that I would shudder to come to something like this as an amateur on these issues because everyone has views and everyone has opinions but getting it right is not just a question of saying ‘there is someone in the Bank who works on this’.
‘I feel that the organization is a bit adrift now, spread very, very thin’
It is actually understanding these issues in their subtlety, in their context and in their regional differentiation, in the history and with the multiple stakeholders involved and I have been doing that for a long time. I think it is an unusual mix of skills that is required and needed in this position. I don’t think that World Bank presidents have been appointed on that basis until now. I feel that the organization is a bit adrift now, spread very, very thin and without the financial heft to carry it on money alone. So the things that I can bring to this position more than ever are important for the Bank. If these are brought to the Bank then the Bank has the potential to play a role that is much more than a bank and that’s what I would hope to help it to do.
EM: Can you expand on that?
JS: Yes, right now to a significant extent the Bank operates like a bank with country loan officers in essence meet with governments and they have a financing envelope and they decide on some loans. This to my mind is not the right way for this organization to respond and leads to an extremely haphazard set of lending programmes. It tremendously underplays things that can be done at a regional as opposed to national level.
‘This leads to an extremely haphazard set of lending programmes.’
It misses out on a very large amount of mobilizing newer technologies because the bank ends up being five to ten years behind on how to use technologies effectively on development. As an academic institution we are on the front line. My colleagues especially in engineering are putting things out that are state of the art and cutting edge and we find that the uptake n the Bank can be a lag of five to 10 years. That really should be shortened dramatically.
‘The Bank has to be the mobilizer and the convenor of new approaches and be the one that can solve quite tricky problems’
The bank as a bank is not a very decisive institution. Its net disbursement total last year in the whole of the developing world was about $16 billion and with six billion people in the developing countries you can see that’s not going very far – you are not even making it to $3 per person. The Bank can’t be the decisive engine in that way. It has to be the mobilizer and the convenor of new approaches and be the one that can solve quite tricky problems of how far governments can come together to mobilize an energy system and work on cross-border multi-country regulatory and financing frameworks. On the health side it is similar where there is a lot of technological advance in health and I am very much involved in showing how these technologies can help delivery in the poorest places. For example community-based malaria control which is a real breakthrough that can save millions of lives. I want the Bank to play a major role for that rather than being reactive and coming in years late. These are areas where I think that the bank can do a lot more than it is doing.
EM: All the previous 11 presidents have been US citizens. Do you not feel that it is time for a candidate for an emerging or developing country? Would you stand against one if they came forward?
JS: I have said for a long time that this should be an open position and I did not really agree with the idea of this joint hold by Europe and the US of the two institutions [of the IMF and World Bank]. I am on record for a long time of asking for an open process and I am trying to be a candidate that is a world candidate that has the support of the United States.
‘I am not the insurgency candidate vis-a-vis the United States although I am trying very hard to win the US backing’
There are several countries from around the world that have endorsed me already and I expect many more will next week. What I would really like to be is a candidate that has broad worldwide support. So I am certainly not running as the US candidate. The countries know me and know I am not someone who represents one country, politics or policy – I never have. If there were outstanding candidates from other places that would be wonderful. But I am standing because I believe I would do a very good job and would like it to be based on the merits of that argument. Of course I am not the insurgency candidate vis-a-vis the United States although I am trying very hard to win the US backing. But I am also trying to be a candidate who would come into this position as a globally supported candidate.
EM: Would you run against a US-backed candidate?
JS: Well, that depends. My name is in nomination already because of the support from other governments. Let’s see what happens. I am still hoping although I don’t think it is an easy call by any chance. I am still hoping I will have the US nomination.