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Good news for Mauritius

Bush appoints Robert Zoellick as World Bank President

President Bush's appointment of former U.S. trade chef and diplomat Robert Zoellick to succeed Paul Wolfowitz as the next president of the World Bank is good news for Mauritius.

When Zoellick takes over the helm of the institution in July, he will already be very familiar with Mauritius. He has visited the island twice in his former jobs with the U.S. government, and is well-versed on the economic challenges facing Mauritius as the country charts a new economic course to deal with the end of special trade preferences in textiles and sugar.

As recently as last year, when Zoellick was a deputy Secretary of State, he met Prime Minister Navin Ramgoolam in Washington to discuss economic reforms and the need for the U.S. Congress to extend the Third Country fabric rule to Mauritius under the African Growth and Opportunity Act (AGOA).

In July 2004, he attended a meeting of G-90 trade ministers that was held in Mauritius, during which he referred to former Foreign Minister Jayan Cuttaree "my good friend." In January, 2003, he was a key speaker at the first annual AGOA Forum that was hosted by Mauritius. He lavished praise on the forum's organizers at the time, calling them "wonderful hosts."

As U.S. Trade Representative, from 2001-2005, Zoellick also worked closely with Mauritian government officials both in Washington and Port Louis to develop AGOA. And he often credited Mauritius as one of the driving forces behind passage of the trade law, which gives Mauritius and other sub-Saharan African nations duty-free and quota-free access to the US market for an array of products. As the trade chef, Zoellick also initiated the Free Trade Agreement with five member countries of the South African Customs Union (SACU).

In announcing the appointment last Wednesday, President Bush acknowledged Zoellick's commitment to Africa. "Bob has had a strong voice for Africa," the president said. "He's helped implement the AGOA that has increased America's trade with that continent."

In accepting the nomination, Zoellick referred to Africa. "In recent years, some developing countries have achieved access to finance and have boosted growth to impressive levels," he said. "But too many lands, particularly in Africa, are denied opportunity because of disease, weak health care, and child mortality, hunger and poor agricultural infrastructure, lack of good schools..."

Bush also called Zoellick "a committed internationalist. He has earned the trust and support of leaders from every region of the world. He is deeply devoted to the mission of the World Bank. He wants to help struggling nations defeat poverty, to grow their economies, and offer their people the hope of a better life."

Bush tapped Zoellick to be the World Bank's 11th president after Paul Wolfowitz announced his resignation following a scandal over a compensation package for his girlfriend, who is also a Bank employee. The scandal drew negative press around the world, and calls by many foreign governments for Wolfowitz's resignation.

Many governments were critical of Wolfowitz's appointment in 2005 because as a top Defense Department official he was considered a chief architect of President Bush's war in Iraq.

Zoellick, age 53 and the son of German-American parents, will come to the Bank with a long career in diplomacy and development economics. He previously held two high-ranking jobs in the Bush administration. Until last summer, he was Deputy Secretary of State and played a key role in shaping the White House position in ending the violence in the Sudan's troubled Darfur region.

He was also the U.S. Trade Representative, and before that, as an aide to President George H.W. Bush, the current president's father, he helped negotiate the North American Free Trade Agreement with Canada and Mexico.

His most recent accomplishment was negotiating to bring China and Taiwan into the World Trade Organization (WTO). He left government service in 2006, and is now with the New York investment firm, Goldman Sachs.

Zoellick has close ties to the current president, having served as his foreign policy adviser during the 2000 presidential elections.

He is considered a free-trader and is widely liked and respected by both developing and industrialized countries. A lawyer by training, Zoellick is often called "brilliant and capable." Reaction to his nomination has been largely favorable so far, with many countries, including Brazil and Germany, announcing their support.

Traditionally, the United States appoints the president of the World Bank, and the Europeans select the head of the International Monetary Fund. Zoellick's nomination will most certainly be approved the World Bank's Board of Directors, a third of whom are European.

Founded in 1944 to help in the reconstruction of Europe after World War II, the modern-day mission of the Bank is to eradicate global poverty. It has since given $400 billion in loans for this purpose. Zoellick will oversee a staff of 10,000, at both the Washington headquarters and in offices around the world. Part of his immediate mission will be repairing the Bank's image, which was sullied by the Wolfowitz scandal, and regaining the respect of the institution's staff.

The World Bank has had an important presence in Mauritius, having provided 40 loans and credits worth a total of about $480 million since 1963.

The Bank currently has one active project - a $12.4 million loan to improve sewerage and sanitation conditions. Last December it approved a Trade and Competitiveness Development Policy Loan - the first of three - that will finance 10 percent of the current years' budget deficit, help diversify the country's debt portfolio, stabilize the economy and improve public sector efficiency.

The Bank is also preparing an urban transportation program to address traffic congestion in Port Louis, and it may become involved in projects to finance airport renovation or land management and housing, according to the World Bank's Country Partnership Strategy for Mauritius.

In recent years, the Bank's role in Mauritius has been changing and evolving, reflecting the country's success in borrowing money on the international capital markets. This is due to the island's economic success and the fact that it is now considered a middle income country.

Because of its relatively high income, Mauritius is one of only a few African countries eligible for World Bank loans. As a result, it is expected that the Bank's involvement will increasingly involve more analytical and advisory assistance to help Mauritius diversify, reform its economy and become more internationally competitive, while also protecting its people from the shocks of globalization.

"The World Bank's strategy will be to support the Government of Mauritius in meeting these challenges," according to the strategy paper.

Zoellick certainly won't have to be briefed on these challenges, as he's seen them all first hand. Now the test will be how Zoellick might he might use his position at the World Bank to further help Mauritius - and the rest of Africa.

And it will also be a test of how leaders in Mauritius can use the goodwill and friendship they have developed with this new leader in international development to advance their economic agenda with the Bank.

a m e r i c a n   s c e n e

WEEK-END --- dimanche 3 juin 2007