IFI governance


New IFC managing director appointed amidst concerns over World Bank’s private sector-led approach to Covid recovery

23 March 2021

Makhtar Diop, the former vice president for infrastructure at the World Bank Group, has been appointed managing director and executive vice president of the World Bank’s private finance arm, the International Finance Corporation (IFC), assuming the position on 1 March. Diop, who is Senegalese and was the country’s minister of economy and finance, is IFC’s first African managing director.

Diop inherits the “IFC 3.0” strategy, which controversially links increasing developing countries’ capital market integration to positive development impact (see Observer Spring 2018), and responsibility for the implementation of the IFC’s Green Equity Approach published in 2020 (see Observer Spring 2017; see Observer Winter 2020).

As the World Bank’s vice president for infrastructure, Diop helped to oversee the Bank’s Maximizing Finance for Development (MFD) approach, whereby it promotes de-risking big infrastructure projects to attract private sector in the Global South (see Observer Summer 2017). The Covid-19 pandemic has deepened questions over the development impact of the Bank’s private-sector led approach, especially in terms of financing recovery programmes and the central role given to the IFC within this (see Background October 2020).

Strengthened safeguards and accountability at the IFC were a precondition for the approval of the US’ $5.5 billion contribution to the IFC’s capital increase, authorised by the US Congress last year (see Observer Autumn 2020).

In a video posted in early March, Diop said, “we all need to bring more investment in countries to make the economy resilient and help people move out of this crisis together,” and emphasised the private sector’s role in creating jobs.