Andrea Shalal and David Lawder

WASHINGTON, (Reuters) – Kristalina Georgieva, International Monetary Fund Managing director, defended actions of the fund in changing the language regarding Brazil’s climate risk as part an economic assessment. This was after almost 200 IMF staff sought answers.

Staff signed Monday’s petition, focusing new attention on Georgieva only two weeks after winning the backing of IMF Executive Board despite claims that she used “undue pressure” on staff at bank to change data in favor China.

It was asked by the petition if Georgieva, her office or both acted to “order or ask for or advise staff to delete specific language regarding climate change” from Brazil’s Article IV staff report. The request came after Brazil’s objections and it was submitted to the IMF board.

Bloomberg reports this month that the last language in the report on Brazil’s climate change economic risk was changed from the initial draft.

The issue at hand is a September IMF Staff Report that stated that Brazil could experience “potentially more disruptive weather events (e.g. droughts or floods) that may have important adverse consequences” for its agricultural and electrical production.

EXTRACTING JUDGMENT

Georgieva replied to staff Monday, and published it on Tuesday. She stated that Article IV consultations were held with Brazil in the late summer and early part of July shortly after IMF Board in May adopted a policy to include climate change mitigation recommendations as part of its monitoring over the largest emitting countries.

According to Georgieva, IMF staff didn’t have the time or resources for an in-depth assessment of Brazil’s climate risk. This was also supported by Alfonso Bevilaqua (IMF executive director representing Brazil) and 10 other smaller countries. Georgieva claimed that the language used in the final analysis was more appropriate.

Georgieva stated that the Management Team (including myself) played a constructive part, trying to maintain the integrity of staff work and to seek to understand the concerns of the Brazilian authorities. This case was not unusual; managers often work to solve differences between departments. The management exercised judgment within the bounds of its authority.

Staff requested that Georgieva be monitored closely by IMF staff in order to verify that her decisions are consistent with fund policy and procedures. Bevilaqua was also a major participant in IMF’s ethics inquiry into the World Bank data-rigging claims against Georgieva.

The petition stated that while we don’t believe there was a quid proquo, it asked the Managing Director that she realize that deviations from the standard procedures and rules make her (and/or the institution) susceptible to such perceptions.

These 194 signatures make up about 7% from the IMF total staff of approximately 2,700.

While the IMF board didn’t find conclusive evidence to support Georgieva’s wrongdoing, it was the largest shareholder of the fund, and demanded that changes be made at the IMF, World Bank, and World Bank to protect whistleblower protections and data integrity.

Neiman was nominated by the Biden administration to be the Treasury supervisor for IMF and World Bank. Senators heard from him Tuesday that allegations made against Georgieva raised “serious and legitimate questions and concerns.”

Reuters reported Tuesday that Georgieva was denied a meeting with the World Bank board in order to address the accusations made by her lawyer, who were hired by the board for the investigation.