World Bank to rule on Wolfowitz role

Paul Wolfowitz's future as World Bank president hung in the balance yesterday after the bank's board issued a damaging finding on his role in the Riza affair and promised to reach a decision on the matter "expeditiously".

The promise of further action will intensify pressure on Mr Wolfowitz to step down of his own accord to avoid possible censure for securing a large pay rise and promotion for Shaha Riza, a former bank official with whom he was romantically involved.

Pressure mounted when Roberto Danino, the bank's former general counsel, confirmed that he had told the board's ethics committee that there was no serious legal risk to the bank if it offered Ms Riza a severance package rather than the attractive secondment deal Mr Wolfowitz eventually dictated.

Earlier yesterday, though, there was no indication that the board was ready to try to force Mr Wolfowitz to quit, or that the bank president - who issued a public apology on Thursday - was ready to give up the fight.

Much will now depend on the US position, which is more nuanced than Thursday's White House reaffirmation of confidence in Mr Wolfowitz suggests.

Some US critics began to call for him to go yesterday. Ken Rogoff, a former chief economist at the IMF said: "President Wolfowitz's credibility is so badly compromised that the board is . . . going to have to force him to resign."

Reports suggest that European countries took the lead during the marathon emergency session of the 24-member board in driving for the release of all documents relating to the case. However, there was no consensus to call for his resignation.

The board statement said Mr Wolfowitz "sent the vice-president, human resources, a written memorandum directing him to reach agreement with the staff member and specifying in detail the terms and conditions".

In Europe, meanwhile, development activists, many of whom opposed Mr Wolfowitz's appointment, have been pressing their governments to demand his resignation.

Alex Wilks, co-ordinator of the European Network on Debt and Development said: "We are concerned that too many of them are wobbling and might let him off the hook in exchange for vague promises."

Campaigners said they were concerned that while the UK had been one of Mr Wolfowitz's strongest critics, UK prime minister Tony Blair might intervene to save him if asked to do so by the White House.

Meanwhile, Mr Wolfowitz's former lover said that her job was switched to another location "contrary to my wishes".

Shaha Riza painted herself as a victim who was forced to leave her job at the bank because of her close relationship with the president.

Her comments were in a memo to an ad-hoc committee of the World Bank looking into the circumstances surrounding her transfer. The memo was part of a broader set of documents released yesterday by the World Bank. (Additional reporting AP)