IMF chief embroiled in China data fraud scandal

The Economist on Wednesday called for the resignation of Kristalina Georgieva, the managing director of the International Monetary Fund (IMF), after a World Bank investigation revealed that she pressured staff during her tenure as chief executive. To improve China’s ranking in the World Bank’s Doing Business Report.

It is a rare move for the Economist, known for its deep political and economic analysis, to name Ms Orkieva outright.

The economist said “the behavior of the damage of the IMF’s ability to protect the world’s economic data and credit, the article stresses that in the era of China and the United States against each other, the chairman of the IMF should mediate disputes with a neutral attitude, today’s scandal only to oppose the multilateralism used to indicate” from international agencies against China “.

“The next time the IMF tries to mediate a currency dispute or help a country borrowing from China restructure its debt, the IMF’s critics will cite this investigation to undermine the institution’s credibility,” the editorial said. “That is why Ms Georgieva should resign.”

Deutsche Welle reported that Shanta Devarajan, a World Bank official who oversaw the writing of the 2017 doing Business report, spoke out in support of Georgieva on Sunday, saying her claims that she manipulated data for China were not true. Devarajan said he never felt pressured to change China’s score, and That Georgieva’s approach was to further verify China’s data and make sure it could get credit for their reforms.

According to Deutsche Welle, Georgieva personally hired SKDK, a public relations firm, to fight the allegations in response to a report by WilmerHale, the law firm commissioned by the World Bank to conduct the investigation. The IMF’s executive board is also conducting an independent review of the allegations.

In addition to international organizations, U.S. Congress is also concerned, with three Republican members of the House subcommittee on Financial Services, National Security and Development sending a letter to Treasury Secretary Janet Yellen asking her to report to Congress on the Treasury Department’s review of the case, Deutsche Welle reported. In August, the U.S. government reportedly decided to allocate $650 billion of currency reserves known as Special Drawing Rights (SDRs) to all IMF members, in which China received SDRs worth about $42 billion.