Of course, the chief economist of the World Bank does not enjoy the same kind of authority as its president – at present a Bush appointee, Robert Zoellick. Previously US deputy secretary of state, Zoellick succeeded the high-profile neoconservative Paul Wolfowitz, whose reign ended in ignominy.
Nonetheless, Lin's appointment is a clear indication that China can no longer be ignored, notwithstanding the fact that it espouses policies at variance with Western free-market orthodoxy. China, by virtue of its growing economic power, is in the process of barging its way into the citadels of global economic governance.
Western governments are faced with a difficult dilemma: either they can choose to hold China at arm's length until it can no longer be ignored, or alternatively they can usher China into the corridors of power before that decision becomes, in effect, a question of force majeure.
Lin's appointment suggests that in this case a more far-sighted approach is being pursued. Foot-dragging and inertia, however, remain the predominant response.
Gordon Brown has uttered timid words about "reframing the international architecture", suggesting institutions such as the World Bank and IMF were built for a bygone era, but there was nothing concrete, merely a further round of platitudes.
The entry of the Chinese into the highest echelons of the World Bank parallels the extraordinary turn of events at the back end of last year when – following huge losses as a result of their exposure to the US subprime market, and in desperate need of massive injections of capital – major Wall Street investment banks such as Bear Stearns, Merrill Lynch and Morgan Stanley were forced to turn to Chinese banks and the China Investment Corporation, among others.
The financial pillars of Wall Street, as a consequence, are now significantly underpinned by Chinese money. Wall Street paid the price for its willingness to live at the outer edges of risk in the cause of greed, while the Chinese have reaped the benefits of being the world's biggest savings machine.
