On May 30th, U.S. President George W. Bush announced the nomination of former deputy Secretary of State, Mr. Robert Zoellick, as the president of the World Bank (WB). He replaces Mr. Paul Wolfowitz, who resigned from the position upon the revelation of a scandal involving the gift of a hefty pay rise to a partner. The nomination did not stir up much controversy; a sharp contrast to Wolfowitz's nomination as a replacement for Mr. James D. Wolfensohn.

The President of the World Bank is routinely nominated by the United States, the largest shareholder of WB, and typically is an American. Mr. Wolfensohn, who is originally from Australia, adopted the American nationality so that he could carry out his work as WB president. A nomination must be approved by the 24-member Board of Executive Directors, the WB's highest body of power. A president remains in office for five years in a term, and can be re-elected. In its latest announcement on presidential nomination, the Board stated that any executive director can make a nomination. The Board also revealed the qualifications for succeeding WB presidents that include a sense of political objectivity and independence. However, changes in nomination rights and qualifications are not substantial, and the U.S. nomination will certainly be approved.

The World Bank is a general name for the International Bank for Reconstruction and Development (IBRD), established in 1945, that by now, has evolved into a group consisting of five closely related development institutions-- the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and the International Centre for Settlement of Investment Disputes (ICSID).

The president of the World Bank is also president of the World Bank Group. Primarily aimed at the reconstruction of Europe, the WB turned to worldwide economic aid after 1948, and established its mission to reduce poverty in the late 1960s.

At present, the WB provides 20 billion dollars in loans to developing countries annually. These loans, always attached with conditions, have an important impact on the recipient's national policies- economic policies in particular. In most cases, they have to guarantee a policy of free market economy.

In 2005, Bush nominated Paul Wolfowitz -- a neo-con hardliner, designer of the Iraqi war and Defense Secretary at the time��to be the WB president, in an effort to promote the U.S.-style of freedom and democracy worldwide, through this institution. In response to claims that the new president would use WB financial power to "promote democracy" in the Middle East and other regions, Wolfowitz said he would not link loans with "democracy". However, during his term Wolfowitz punished "corruption" in some countries by suspending or delaying loans and contracts.

Following his nomination, Zoellick said he would continue to push forward Wolfowitz's "anti-corruption campaign" and spell out new plans to help developing countries. Therefore, the U.S. practice of spreading "economic freedom" and "political democracy' through the WB will continue. This is also the way Washington makes use of the International Monetary Fund (IMF). Indeed, it is necessary to strengthen supervision on the use of loans and aids to poorer countries; yet attaching conditions to aid runs counter to the central mission of poverty reduction.

In the World Bank, the right to vote on major issues, or an IBRD voting right, is decided by the proportion of shares. Currently, the U.S. holds 16.38%, Japan 7.86%, Germany 4.49%, and Britain and France both hold 4.3% of shares respectively. China holds 2.78 percent. China has been actively carrying out its duties within international organizations, including the WB and IMF, trying its best to promote mutually-beneficial cooperation with countries, and regions, and pressing ahead towards a more rational international economic and financial order.

The article is by Fang Ming, a senior analyst from the Bank of China; and translated by People's Daily Online.