A number of media outlets reported on Thursday (September 16) that the World Bank had canceled an important report that assessed the business environment for countries around the world.
The executives involved in the affair are Kristalina Georgieva (now president of the International Monetary Fund), then CEO of the World Bank, and Jim Yong Kim, then president of the World Bank.
After discovering data breaches in the “Business Environment” report in 2020, the World Bank temporarily suspended publication of the report and ordered an external data integrity investigation by a lawyer.
On Thursday, the bank announced the results of the investigation, which concluded that senior executives at the bank, including Georgieva, had participated in lobbying economists to help improve China’s ranking in 2018. At the time, Georgieva and others were trying to persuade Beijing to support increased World Bank funding.
The Chinese Embassy in Washington did not immediately respond to a request for comment.
Georgieva said that when it comes to the World Bank’s role in the World Bank’s Doing Business 2018 report, she “fundamentally disagrees with the results and interpretation of the data breach investigation.”
The “Business Environment” report has always been the flagship publication of the World Bank. In addition to financing poor countries, the World Bank also conducts various economic studies. The annual report attracts media reports around the world every year, and countries are also trying to change their policies to improve their rankings.
For many years, the report was seen as “successful” in boosting government governance – improvements in businesses that obtain permits, connect to electricity, or pay taxes – these elements have also been factored into. grading considerations.
WilmerHale, the law firm responsible for the external investigation into the report, found that in 2018, CCP officials were eager to see China’s ranking improve. Subsequently, World Bank employees such as Jin Yong and Georgieva organized a series of meetings. the ratio calculation method to improve China’s ranking.
The survey report says the World Bank team has identified three data points that can be changed to improve China’s score. For example, China has passed a Secured Transactions Law that applies to secured loans. World Bank staff believe that passing this law can greatly improve China’s legal rights scores to meet the demands of senior World Bank leaders.
The investigation report said World Bank employees knew the changes were inappropriate, but “most of the ‘business environment’ employees we spoke with said they fear retaliation.”
The survey report says that although the report’s data collection process has been completed, World Bank economists have reopened the data sheet and changed the data for China. As a result of these changes, the ranking of China’s business environment among countries in the world is no longer 85th, but has risen to 78th.
Changes to the data method in the report also affect the rankings of Azerbaijan, United Arab Emirates, and Saudi Arabia.
The US Treasury Department is the department responsible for overseeing US participation in the work of the International Monetary Fund and the World Bank, which has expressed concern about the findings of the World Bank’s investigative report. The International Monetary Fund and the World Bank are collectively owned by member states, and the US Treasury Department has the largest ownership of these two institutions.
Alexandra LaManna, spokeswoman for the US Department of the Treasury, said: “These are major findings, and the Department of the Treasury is analyzing this report. Our primary responsibility is to maintain the integrity of international financial institutions.”
In 2018, the World Bank’s chief economist, Paul Romer, said in an interview with the Wall Street Journal that he feared the “Business Environment” report was vulnerable to public relations that alters data for political gain. .
This is the first time that a senior World Bank official has publicly expressed concerns about the “Business Environment” report. Romer said he lacked confidence in the series of methodological changes in the report.
Shortly after the World Bank denied that the report had been tampered with, Romer announced his resignation.
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