RÜDIGER LENTZ: You said recently, that to fight poverty effectively - to reach the millennium goals which pledge to half hunger in the world by 2015 – do we need to more aggressively fund also agricultural products through investments in the third world, especially in Africa? Does that mean that, on the other hand, industrialized regions like the USA or the Europeans will have to open up their markets?
ROBERT ZOELLICK: It does, and we also need to cut their subsidies and that’s one reason why it would be very important to complete the DOHA development which my good friend and former colleague, Pascal Lamy [Director General of the World Trade Organization], now is trying to do. […] Yes, of course, we need to be an open market and this is not only quotas and tariffs but, increasingly, Europe and other countries use sanitary and private sanitary standards as a way to block these products. And part of this is understandable, countries have standards, we need to help the developing countries to have products that meet those standards, but some of this could be a new form of protectionism.
LENTZ: China is not only a growing economy, it also has a huge currency war chest, so to speak. Is that a potential stabilizing factor or do you see it as a growing concern?
ZOELLICK: I think it is a reality. The answer could be, I think, that it is going to be part of the international economic system. […] The Chinese are putting a lot of investment into Africa for resource development. That can be good if it is done in a way that doesn’t feel bad, doesn’t feel like corruption. So, when I say “it is a reality,” we have to adjust for it and try to work with the Chinese on these issues. Sovereign Wealth Funds, whether it be the Middle East or whether it be in China […] which would have been a fearsome factor in the autumn of 2007, in 2008 may be the critical source of capital coming back into the market. But, this—Mr. Steinbrueck and others have talked about, Hank Paulson for the U.S.—this has to be done transparently. So, my point about China is, it’s a rising economic force. That is, what I would say, is the reality. It is in our interest to work with them whether on transparency in terms of Sovereign Wealth Funds, development in Africa, currency and trade issues. So that China can be—as I called it in another context—a responsible stakeholder in the international economic and development system.
LENTZ: You have referred to the history of the World Bank as a 60-year old institution and during its history, it has functioned as a monopoly for decades, so to speak. Now we have many regional development banks out there in South America, in Asia, in Africa, even in Europe. Does that make your position more difficult, are you becoming obsolete as the institution?
ZOELLICK: Well, I think, I’d even go further. You’ve got foundations, you’ve got increasingly bilateral aid flows including from Germany. […] I hope, we can help them continue their commitment to the multilateral system. And, I think, what it means is: We have to change with that. And we have to see ourselves a catalyst in a network which is what increasingly we do. We apply this expertise and the knowledge, we pull parties together. I don’t think competition is a bad thing in the development field. However, we have to make sure you harmonize the efforts.
LENTZ: You know Germany very well. You have been working closely with Germany during the Two-plus-Four-talks and German unification and, later on in a different capacity, including trade and foreign policy. How would you judge — in your new capacity — the Germans following the quest of the World Bank especially in the area of climate change and international development and aid?
ZOELLICK: Well, first, the Chancellor [Merkel] and Foreign Minister Steinmeier and the Treasurer Steinbrueck have really been very helpful. Since I have taken over this institution, Berlin has hosted the International Development Association meeting that put all this together. So, I am happy about both the intellectual and the financial resource side. But there is a caution. On one of my stops to Berlin, I also went to visit a number of the members of the Bundestag, in part, at the request of the government. And there I saw a phenomenon I have seen in other countries, where there is a greater desire to say “We’ll put money into this area but we want it to be focused on individual German programs as opposed to multilateral programs.” To my worry for Germany – for other countries as well – is “How can we make sure that we get the greatest bang for the buck or the Euro, in this case?” that I believe has to try to work through the multilateral system which, traditionally, Germany is very committed to. I hope it stays so.
Robert B. Zoellick became the 11th president of the World Bank Group on July 1, 2007. Prior to joining the Bank, Mr. Zoellick worked for the Goldman Sachs Group. In 2005-06, Mr. Zoellick served as the deputy secretary of the US State Department. From 2001 to January 2005, Mr. Zoellick served in the U.S. cabinet as the 13th US trade representative.
Rüdiger Lentz is head of the Deutsche Welle studio in Washington, DC, and executive director USA of the Atlantic Initiative. He conducted the interview with Mr. Zoellick for Deutsche Welle on January 18, 2008.
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