Outgoing Prime Minister Tony Blair is a contender for the job of president of the World Bank, according to one of America's most respected economists.

The news comes after the board of the World Bank announced its president Paul Wolfowitz would resign at the end of next month.

Mr Wolfowitz had been under pressure to step down since it emerged that he helped to arrange a pay increase and promotion for his partner - who also worked there.

The World Bank has traditionally been run by an American. The US is the bank's largest shareholder and its biggest financial contributor.

But Nobel prize-winning economist Joe Stiglitz, a former senior vice president and chief economist at the World Bank, told BBC Radio 5 Live Mr Blair was in the frame for the high-profile role.

He said: "He is one of the people that is clearly being discussed.

"I think it would be good for the institution at this juncture if they had somebody who was an economist who really understood what development was entailed and could work closely with the staff that has been very alienated by Paul Wolfowitz over the last two years and bring together the institution.

"It wouldn't rule him (Blair) out but I would say that if I were going through a first priority list of priorities it would probably would begin with somebody with real experience in development.

"But Blair has clearly been a political leader that has has the kinds of connections that one needs, that would be useful as head of the institution."

The World Bank provides financial and technical assistance to developing countries around the world.
© Copyright Press Association Ltd 2007, All Rights Reserved.