World Bank head Robert Zoel­lick had a recent speak­ing engage­ment at Johns Hop­kins Uni­ver­sity in Wash­ing­ton. In his com­ments, he told the audi­ence not to expect the US dol­lar to con­tinue to be the world’s major currency.

From the Voice of Amer­ica, Mil Arcega attended the speech.

World Bank pres­i­dent Robert Zoel­lick says the U.S. dollar’s role as the world’s reserve cur­rency may be dimin­ish­ing as a result of the finan­cial cri­sis. Although he says the dol­lar will remain a major eco­nomic force, Zoel­lick says the bal­ance of power is shift­ing. And as the global finan­cial sys­tem evolves, Zoel­lick says other cur­ren­cies, includ­ing the Euro and the Chi­nese Yuan could become increas­ingly attrac­tive alternatives.

In the after­math of the global eco­nomic melt­down, the head of the World Bank says the U.S. should not assume the dol­lar will always be the world’s busi­ness cur­rency. Speak­ing at the School of Advanced Inter­na­tional Stud­ies at Johns Hop­kins Uni­ver­sity in Wash­ing­ton, Robert Zoel­lick says world finances are under­go­ing a seis­mic shift.

“The United States would be mis­taken to take for granted the dollar’s place as the world’s pre­dom­i­nant reserve cur­rency,” he said. “Look­ing for­ward, there will increas­ingly be other options to the dollar.”

Among the options, Zoel­lick says the 16-nation Euro and China’s Yuan –also called the Ren­minbi — are quickly gain­ing acceptance.

Zoel­lick cites China’s recent move to list for­eign com­pa­nies in its stock exchange as a step towards mak­ing the com­mu­nist coun­try a global finan­cial powerhouse.

“China is mak­ing it eas­ier for trad­ing part­ners to do busi­ness in Ren­minbi, for exam­ple, through cur­rency swaps. We are likely to see this shift in the world of invest­ment as well,” he said.

Zoel­lick also ques­tioned the role cen­tral banks played in the eco­nomic cri­sis. And he injected him­self into the Con­gres­sional debate over how much power the U.S. Fed­eral Reserve should have — say­ing the Trea­sury Depart­ment may be bet­ter suited to reg­u­late the U.S. finan­cial system.

“In the United States, it will be dif­fi­cult to vest the inde­pen­dent and pow­er­ful tech­nocrats at the Fed­eral Reserve with more author­ity. My read­ing of recent cri­sis man­age­ment is that the Trea­sury Depart­ment needed greater author­ity to pull together a bevy of dif­fer­ent reg­u­la­tors. More­over, the Trea­sury Depart­ment is an exec­u­tive depart­ment and there­fore Con­gress and the pub­lic can directly over­see how it uses any added author­ity,” Zoel­lick explained.

Regard­ing the Pitts­burgh sum­mit last week for the world’s biggest economies, Zoel­lick applauded the res­o­lu­tion mak­ing the G20 the pre­mier forum for global finan­cial coop­er­a­tion. But to main­tain legit­i­macy, Zoel­lick says the major devel­oped and devel­op­ing nations who make up the G20 must rec­og­nize the voices of the 160 coun­tries left outside.

“It needs to help offer a hand to the poor­est and weak­est coun­tries, the 1.6 bil­lion peo­ple still with­out elec­tric­ity and the ‘bot­tom bil­lion’ trapped in poverty because of con­flict and bro­ken gov­er­nance,” he said.

Zoellick’s com­ments come as the World Bank and the Inter­na­tional Mon­e­tary Fund pre­pare to hold meet­ings in Istan­bul next week.

I’m sure Zoellick’s bosses at the US gov­ern­ment have a entirely dif­fer­ent opin­ion on currencies.

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