By Lesley Wroughton WASHINGTON, March 2 (Reuters) - The World Bank's No. 2 official on Friday defended the lender's decision to ramp up its presence in Iraq after a staff driver was caught in cross-fire and wounded at a checkpoint in Baghdad last month. Managing Director Juan Jose Daboub said the World Bank regretted the incident and had evacuated the Iraqi man to neighboring Jordan for treatment. "We are in many countries and Iraq is not an exception," Daboub, who visited Baghdad last month for discussions with the Iraqi government, told Reuters in an interview. "We define our offices in each country according to our programs," he said, noting that the bank's strategy was to support Iraqi government efforts to rebuild the country, including restoring basic services and enabling private-sector development. The World Bank's involvement in Iraq has been a delicate issue for bank President Paul Wolfowitz, the former U.S. deputy defense secretary. He still faces questions about his role in the planning of the four-year war, which is opposed by some of the bank's biggest members including France and Germany. A Washington-based whistle-blower protection group this week charged that the bank was trying to cover up the shooting as it prepares to broaden its operations in Iraq and appoint a new country director despite an increase in violence. Quoting inside sources, the Government Accountability Project said a bullet pierced the driver's right shoulder while he waited to cross a checkpoint on his way to the protected Green Zone, from where the bank operates. "Wolfowitz's apparent determination to use the World Bank to further questionable American military goals in the Middle East is a fundamental distortion of the bank's mission, a violation of its founding Articles of Agreement, and a reckless waste of donor resources," Bea Edwards, the group's international program director, said in a statement. STAFF MEETING Daboub said he informed staff of the incident in a regional meeting he called the day after he returned to Washington from a seven-nation Middle East tour. "We are not hiding anything," said Daboub, a former El Salvador finance minister. "The bank has previously worked in many such countries, and currently have two offices in Sudan," he added, citing the bank's role in rebuilding El Salvador, where a 12-year civil war killed an estimated 75,000 people and drove a million people from their homes. The bank has nine employees in Iraq and will soon increase the number to 11, Daboub said. He said the bank's planned expansion in Iraq followed pressure from both donor countries eager to ensure foreign aid is properly spent and the Iraqi government looking to restore services to Iraqis. Daboub said he urged Iraqi officials during his visit to Baghdad to speed up the disbursement of already approved funds for reconstruction projects. The bank has approved $700 million in rebuilding funds for Iraq -- $285 million from its own resources and $411 million from a pot of cash contributed by donors. The European Commission, Japan, Spain and Britain are among the biggest contributors to the International Reconstruction Fund Facility for Iraq, which consists of two trust funds. Mindful of his own experiences in El Salvador, Daboub said of rebuilding Iraq, "There is a good possibility as long as people ... do not allow the challenges to become obstacles."
