Attali tries to head off coup at EBRD

JACQUES ATTALI and his management team at the European Bank for Reconstruction and Development are working on proposals to restructure the organisation in an attempt to forestall a coup against him by the bank's leading shareholders.

The plans are likely to include the merger of the bank's merchant and development banking arms to counter criticisms that not enough money has been channelled to Eastern Europe.

But it is understood that the current management will not propose the creation of a chief executive, who would in effect be a 'number two' to Mr Attali.

Mr Attali is fighting for his political life as finance ministers of the Group of Seven, principal shareholders in the EBRD, prepare to pin his fate on the outcome of an in-depth audit next month of lavish spending by the bank. Divisions within G7 over whether and when to dismiss Mr Attali have in part allowed him to remain in his post, despite adverse publicity following disclosures that the bank spent pounds 55.5m on the refurbishment of its London headquarters, and pounds 750,000 on chartering private jets.

Further damning revelations are set to emerge when the audit report is published on 15 July. Britain, host country of the EBRD, believes the evidence of the report will be severe enough to secure French and German support for a decision to sack Mr Attali. The French EBRD president lost crucial political backing when France's Socialist government was defeated in last April's election.

Britain has already begun to follow up the G7's decision to change the operating structure of the bank in what may be a post-Attali regime. In Washington last week, Baroness Chalker, head of the Overseas Development Administration, sounded out Ernie Stern, who is in effect number two at the World Bank, for a similar position in the European bank.

Mr Stern was approached about a senior EBRD position in 1990 but made it clear he would not work for the bank while Mr Attali ran it.

The G7 has yet to draw up a short list of potential replacements for Mr Attali, but one candidate is likely to be Onno Ruding, the former Dutch finance minister who was the leading choice before President Francois Mitterrand proposed Mr Attali. There are also suggestions that a German candidate may be picked.

Mr Attali came under attack during the bank's annual meetings last April, but there were few signs then that his job was under immediate threat. Last week, however, Lloyd Bentsen, the US Treasury Secretary, made it plain that Mr Attali's future is now in jeopardy.

Washington has tried to oust Mr Attali by proposing a chief executive for the bank, in effect reducing Mr Attali's position to titular head. The EBRD president objected, and the US failed to win support from the European shareholders.

The EBRD furore and pressure on Western budgets has prompted Mr Bentsen to institute a high-level US Treasury review of wages and benefits at all the international financial institutions, such as the IMF and the World Bank. The report has UK backing and may lead to a new era of austerity.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA celebration of British elections
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Editor-in-chief - Financial Services - City, London

£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Guru Careers: Management Accountant

£27 - 35k + Bonus + Benefits: Guru Careers: A Management Accountant is needed ...

Guru Careers: Project Manager / Business Analyst

£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...

Day In a Page

General Election 2015: ‘We will not sit down with Nicola Sturgeon’, says Ed Balls

'We will not sit down with Nicola Sturgeon'

In an exclusive interview, Ed Balls says he won't negotiate his first Budget with SNP MPs - even if Labour need their votes to secure its passage
VE Day 70th anniversary: How ordinary Britons celebrated the end of war in Europe

How ordinary Britons celebrated VE Day

Our perception of VE Day usually involves crowds of giddy Britons casting off the shackles of war with gay abandon. The truth was more nuanced
They came in with William Caxton's printing press, but typefaces still matter in the digital age

Typefaces still matter in the digital age

A new typeface once took years to create, now thousands are available at the click of a drop-down menu. So why do most of us still rely on the old classics, asks Meg Carter?
Discovery of 'missing link' between the two main life-forms on Earth could explain evolution of animals, say scientists

'Missing link' between Earth's two life-forms found

New microbial species tells us something about our dark past, say scientists
Ronald McDonald the muse? Why Banksy, Ron English and Keith Coventry are lovin' Maccy D's

Ronald McDonald the muse

A new wave of artists is taking inspiration from the fast food chain
13 best picnic blankets

13 best picnic blankets

Dine al fresco without the grass stains and damp bottoms with something from our pick of picnic rugs
General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

On the margins

From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'
Sarah Lucas is the perfect artist to represent Britain at the Venice Biennale

Flesh in Venice

Sarah Lucas has filled the British pavilion at the Venice Biennale with slinky cats and casts of her female friends' private parts. It makes you proud to be a woman, says Karen Wright
11 best anti-ageing day creams

11 best anti-ageing day creams

Slow down the ageing process with one of these high-performance, hardworking anti-agers
Juventus 2 Real Madrid 1: Five things we learnt, including Iker Casillas is past it and Carlos Tevez remains effective

Juventus vs Real Madrid

Five things we learnt from the Italian's Champions League first leg win over the Spanish giants
Ashes 2015: Test series looks a lost cause for England... whoever takes over as ECB director of cricket

Ashes series looks a lost cause for England...

Whoever takes over as ECB director of cricket, says Stephen Brenkley
Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected