WASHINGTON – The International Monetary Fund expressed “full confidence” in its managing director Tuesday in response to allegations that while she was a World Bank official, she and others pressured staffers to change business rankings in an effort to placate China.
The IMF’s 24-member executive board said in a statement that its review “did not conclusively demonstrate that the managing director, Kristalina Georgieva, played an improper role."
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But it said a probe into possible misconduct by World Bank staff was continuing. The United States, the IMF's largest shareholder, said it planned to closely monitor the further investigation into the issue. The World Bank and IMF are both global lenders in the United Nations system.
Georgieva has denied any wrongdoing in response to an investigative report by the WilmerHale law firm. The report found she played a role in pressuring World Bank staff to amend data affecting 2018 rankings that were meant to show how welcoming China and other nations were to businesses.
Countries used the annual Doing Business report, which evaluated tax burdens, bureaucratic obstacles and regulatory systems, to attract foreign investment.
The rankings have been discontinued due to the controversy, which also prompted criticism that China, the world’s second-largest economy, has too much influence over international finance organizations.
U.S. Treasury Secretary Janet Yellen spoke with Georgieva by phone and said the report “raised legitimate issues and concerns,” the Treasury Department said in a statement.
However, the Treasury agreed that “absent further direct evidence with regard to the role of the managing director there is not a basis for a change in IMF leadership.”
Yellen said it was crucial to defend the integrity of the IMF and the World Bank.
The “U.S. believes proactive steps must be taken to reinforce data integrity and credibility at the IMF, and that the institution and its leadership must renew their commitment to upholding transparency and whistleblower protections surrounding policies, research, and analysis to provide accountability and public oversight over key decisions,” the Treasury statement said.
Addressing the controversy Wednesday, Gita Gopinath, the IMF's chief economist, said that the IMF took very seriously the need to protect the integrity of its economic reports. She noted that the investigation focused on a World Bank report, not a report produced by the IMF.
“We are constantly working to ensure the highest standards for our data and for our research,” she told reporters at a briefing on the IMF's updated World Economic Outlook. “As part of that we have ongoing reviews all the time and will continue to do so.”
The IMF had said late Friday it was seeking more “clarifying details” in its investigation and the board met again with Georgieva on Sunday.
Georgieva appeared before a panel for more than five hours last week after a presentation by WilmerHale that alleged she and other World Bank officials had pressured staff to alter the data.
The 190-nation IMF and World Bank annual meetings are being held this week in Washington and the controversy surrounding the Doing Business report was threatening to overshadow the agenda of those meetings.
Georgieva, a 68-year-old Bulgarian economist, has served as managing director of the IMF since 2019. She was the fund’s first leader to come from an emerging market economy rather than one of the traditional European economic powers, like Germany or France.
In taking over the leadership of the IMF, she succeeded Christine Lagarde, who stepped down to take over as head of the European Central Bank.