James Wolfensohn, Debt Restructuring WB Chief, Departs

The first time James Wolfensohn started working in Africa, a continent that would virtually become his mission as one of the more famous presidents of the World Bank, it was not an easy assignment. It was not that he did not like the continent. The problem was with communication.

He was only 28 when he flew to Lagos, Nigeria, to work for Rheem International, a company trying to build a factory there for the production of air-conditioners. Soon after his arrival, he was approached by a minister that could help him secure a piece of land fitting for the construction of the factory.

He was enthusiastic enough that he decided to see his newly acquired Nigerian partner speak at the parliament. Then he made the mistake of taking a photo inside the hall, an act security officers did not take lightly. He was promptly taken to prison, and the story of a spy infiltrating the hall of parliament to take photos was published in one of Nigeria’s oldest newspapers at the time, West African Pilot.

“Nigeria had given him some feel for the challenges confronting the World Bank in newly-minted nations,” writes Sebastian Mallaby in "The World’s Banker," which tells the story of the World Bank during the 10-year tenure of Wolfensohn at its helm.

The descriptions of Wolfensohn’s personality, who passed away aged 86 on November 25, 2020, are consistent to a fault. He was obsessive, combative and self-assured. He was best known as a banker before his World Bank years, having built an impressive array of networks within the power corridors that gave him access to much of the world’s elite.

More importantly, his ambitions at the World Bank, which dates its founding to the legendary Bretton Woods meetings, were never hidden. His model was Robert McNamara, whose career at the international financial institution came after his more famous post as United States Secretary of Defense during the Vietnam War. McNamara had articulated the Bank’s primary mandate as being on the frontline of the fight against poverty, and near the end of his term he introduced the infamous concept of structural adjustment programmes as the account balances of many African countries went dour.

McNamara would be replaced in 1981, and the Bank would go on to have three single term, mostly forgettable, presidents. Wolfensohn, meanwhile, would become a multimillionaire working on Wall Street before opening a successful consultancy. His versatility was notable, having been a cellist, a board member on various organisations and a philanthropist. Although he was born in Australia, he had also become a United States citizen, a de facto requirement to occupy the highest office at the Bank.

His time would come in 1995, where he narrowly beat out the favourite, Lawrence Summers, the Bank's former chief economist. It was a dream of over 14 years come true since he was first considered for the job. Unfortunately, he was to inherit a Bank, employer of some 10,000 people across the world, that was in deep crisis after having irked both the political left and the right. The former deplored it for its questionable structural adjustment programmes and its funding of projects in developing countries that were environmentally harmful and led to displacement.