IDB may elect Brazil’s first president this Sunday

The assembly of governors of the IDB (Inter-American Development Bank) meets this Sunday (20) to elect the institution’s new president, and there are chances that the Brazilian Ilan Goldfajn will be chosen to assume the position.

Founded 63 years ago, the IDB is considered the largest and oldest multilateral financial organization in the world and finances economic, social and institutional development projects in Latin America and the Caribbean. It has 48 member countries and headquarters in Washington (USA).

If elected, Ilan Goldfajn will be the first Brazilian in charge of the institution. President of the Central Bank between 2016 and 2019, appointed by Michel Temer (MDB), Goldfajn is now director of the Western Hemisphere at the IMF (International Monetary Fund), a position from which he left to run for election at the IDB.

His name was indicated by the Minister of Economy, Paulo Guedes, who made a tour with authorities from the continent in Washington last month, during the annual meetings of the IMF and the World Bank, in an attempt to gather support for the Brazilian.

He is running against four other candidates: Argentine Cecilia Todesca Bocco, secretary of International Economic Relations at the country’s chancellery; Mexican Gerardo Esquivel, one of the directors of the country’s Central Bank; Chilean Nicolás Eyzaguirre, former Minister of Economy; and Gerard Johnson of Trinidad and Tobago, a former IDB official.

The candidates were questioned in the last 12, and Goldfajn was the one that made the best impression among the competitors. He faces, however, a domestic challenge.

The PT, the party of president-elect Luiz Inácio Lula da Silva, worked to postpone the election of the body and sign a name other than that nominated by President Jair Bolsonaro. Former PT Minister of Finance Guido Mantega even sent an email to the US Treasury Secretary, Janet Yellen, asking that the election be postponed for 45 to 60 days.

The election, however, was not postponed, but Goldfajn’s choice was threatened, since authorities do not want to alienate the next president of Brazil. On Thursday, however, Mantega resigned from his position on the Lula government’s transition team, which again gave the former Central Bank president traction at the IDB.

As reported by the SheetGoldfajn’s priorities presented in the bank’s selection process are in line with Lula’s and include combating hunger, promoting cooperation between countries, fostering growth with social inclusion, diversity and environmental preservation.

In theory, the nationality of the body’s president does not matter, because projects financed by the IDB follow technical criteria. In practice, however, the presence of a Brazilian would make it easier for pilot projects to be tested in Brazil, for example.

In November 2022, almost US$ 30 billion were foreseen by the IDB for projects being prepared or implemented in Brazil. Among them, programs to boost bioeconomy businesses in the Amazon, expansion of education in Florianópolis (SC), road investments in the state of São Paulo, sustainable livestock in Mato Grosso, in addition to a series of federal actions.

This Sunday’s election also puts an end to a troubled period — which involved Brazil’s participation. The elect will occupy the post of Mauricio Claver-Carone, an American who took office in 2020, but was unanimously removed in September, accused of getting involved with a subordinate.

Brazil is involved in the story because in the year the American was elected there was a strong willingness for the countries that make up the bank to elect a Brazilian. A number of names were discussed, such as Marcos Troyjo (now on the Brics bench); Rodrigo Xavier; Carlos da Costa (former BNDES) and Martha Seillier (former secretary of the Partnerships and Investments Program), but without success.

Brazil withdrew from placing a nominee after a request directly from then-US President Donald Trump to Jair Bolsonaro, for the country to support Claver-Carone, then director of affairs for the Western Hemisphere at the White House National Security Council. The American’s troubled tenure, however, came to an end before he completed his five-year term.

In a recent interview with SheetClaver-Carone, disaffected by Paulo Guedes, stated that the country had made a bad choice in supporting his dismissal and that it would now not find support to elect a proper name.

Currently, the IDB has among its members 28 countries in the Americas, with voting power, 16 European countries, such as Germany, United Kingdom and France, and 4 Asian countries (China, Japan, Israel and South Korea).

There are two criteria for electing the next president. The first is by shareholding of countries in the region: the US is the country with the highest voting power, with 30%, followed by Brazil and Argentina, both with 11.4%. The second criterion is by simple majority. In a supposed scenario in which the US, Brazil and Argentina vote for the same candidate, one of the criteria has already been met – because the three countries hold more than 50% of the bank’s control. It is necessary, however, that the majority of the 28 agree with the nominee.

There can be up to four rounds of voting, which eliminate one candidate at a time if countries cannot reach consensus right away. Voting starts at 10 am Brasilia time this Sunday.