The fact that Kristalina Georgieva, a Bulgarian elected as IMF Managing Director in 2019 (Kristalina Georgieva) not quite satisfied with Washington, it was known almost from the beginning of her activity as head of the Fund. Financial Times two years ago she reported that the United States and Japan demanded that Georgieva be removed from the post of managing director, but France, Germany, Italy, Great Britain, China and Russia did not agree.
The named countries did not agree with the proposal to remove Georgieva not only because the IMF Executive Board did not find evidence of the Fund’s head’s involvement in violations in the preparation of the 2018 business climate rating (Doing Business Index) The World Bank (WB), which was then headed by Georgieva. A more complex set of relations was involved here.
According to the Nobel laureate in economics, professor at Columbia University Joseph Stiglitz (Joseph Stiglitz), “The intentions to replace or at least significantly weaken the influence of Kristalina Georgieva, Managing Director of the International Monetary Fund, have existed since 2019. This is the same Georgieva whose response to the pandemic quickly provided the funds to keep countries afloat and tackle the health crisis. The one that successfully defended the $ 650 billion (SDR) allocation needed by low- and middle-income countries … Georgieva should be applauded for all of these actions. Then what is it? Why are they trying to discredit and displace it? “
Indeed, for what? Against the background of corruption in the United States, the 78th or 178th place of the PRC, indicated in the annual report Doing Business Index for 2018 does not matter. However, Georgieva was at that time the executive director of the World Bank and, as the American press stated, “Juggled the numbers in the interests of China, counting on an increase in its share contribution to the World Bank”…
Doing Business Index always raised questions about his objectivity. The index gave countries good marks for, say, low corporate taxes and weak labor laws, considering profit as a measure of success. The Index figures have always been approximate, but had a potentially large impact on the country’s rating, and cases of its downgrade discouraged foreign investors from investing.
This is the background against which the displacement of Kristalina Georgieva was prepared.
In 2020, at a seminar on New Forms of Solidarity organized at the Vatican by the Pontifical Academy of Social Sciences, she told the assembled bankers, economists and finance ministers: “Think excessive inequality: Since 1980, the richest 1 percent of the world has received twice as much from global growth as the poorest 50 percent of the world’s people … multiple growth of world trade. Think about the fact that many developing countries have already stopped catching up with countries with high wealth of citizens. Instead of narrowing the gap in living standards, they are now widening it … 736 million people live in extreme poverty (less than $ 1.9 a day), almost half of the world’s population (3.4 billion) have less than 5 , $ 5 … How can we help create an economy that serves people? “
It seemed that a little bit more and Kristalina Georgieva would speak the language of the Marxists. And this is the head of the largest financial organization in the world, which got 190 states hooked on dollar loans! And the degree of dependence of debtors is such that now the IMF has the right to interfere in the internal policy of the borrower, adjusting its economic and state policy.
Many financial market players do not like the fact that the world’s main financier suddenly began to take care of the poor and developing countries and allow only what the country can afford to pay on debts, and not how much the creditor requires. This was especially not to the liking of private investors, who are confused by the IMF’s policy.
As for Kristalina Georgieva, her logic can be understood. Growing up in socialist Bulgaria, educated at the country’s oldest institution of higher education, the Karl Marx Institute, where she became an assistant professor and later Ph.D., she imbibed ideas of social equality that even the London School of Economics and the Australian National University with Harvard Business School do not shook. Marx and Harvard get along in it, which cannot be said about the International Monetary Fund.
As writes Project Syndicate, scandal with Doing Business “undermined confidence in the World Bank and the IMF, but this should not obscure real problems: the disproportionate influence of the United States, the deeply one-sided approach of the IMF and the unwillingness of the G7 economies to provide other multilateral intergovernmental bodies with the opportunity to solve world problems”…
Kristalina Georgieva still retains her post, but in the US Congress, where her resignation is being sought, they will try to make the scandal louder. Otherwise, it will be difficult to hide in the shadows the fact that the International Monetary Fund, conceived as an international clearing union for mutual settlements and currency conversion, equally treating all countries, has become the fiefdom of the United States.
Cover photo: REUTERS /Ludovic Marin / Pool
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