WASHINGTON - Paul Wolfowitz may be a contentious choice to lead the World Bank but development experts say he may also be just the right person to change a bureaucracy-mired institution that many believe has lost its way.

Still, foreign governments and the development community are worried he is too close to the White House and won't be able to distance himself enough from U.S. foreign policy to lead an institution that must be regarded as a neutral entity.

Manish Bapna, head of the Washington-based Bank Information Center, cited concern that under Wolfowitz, the bank would resort to strategic lending to advance U.S. policy.

"Given the strong connection that Wolfowitz has made between security and development, it'll be a very fine line that he will have to tread which the institution will not become overly politicized," Bapna said.

"His close association with the Bush administration does raise serious concern about whether or not the 'war on terror' will feed into the projects and policies of the World Bank."

Wolfowitz, who, as deputy to Defense Secretary Donald Rumsfeld, helped to plan the Iraq war, has shown he is not afraid to implement controversial policies and can claim broad experience in world affairs.

He may need both.

If his candidacy is approved by the World Bank board of shareholder governments, Wolfowitz will take on a 10,000-strong institution many critics see as bloated and unfocused.

Since taking office in 2001, the Bush administration has pushed the bank and other multilateral lenders to show shareholders, and voters, that lending billions to the world's worst-off countries can make real inroads against poverty.

The Bush Treasury- backed by Congressional leaders- has also insisted that global institutions be more aggressive in rooting out corruption and fraud and share more information about their operations.

The choice of Wolfowitz, 61, has been widely compared by analysts and the media to that of Robert McNamara, who led the bank from April 1968 to June 1981.

McNamara was a former defense secretary and architect of the Vietnam war and in his tenure was accused of choosing aid recipients based on their support for U.S. foreign policy.

Despite a cool response by European countries to Wolfowitz's nomination, the Treasury Department said it consulted widely with other shareholders on the qualifications of the next World Bank president.

Chief Treasury spokesman Rob Nichols said shareholders agreed a president must have proven leadership ability, management mileage in a big global organization, international diplomatic experience and commitment to development.

"Our consultation included discussions on the qualifications and qualities for the new president," Rob Nichols, chief treasury spokesman, told Reuters. "Paul Wolfowitz meets and exceeds each and all of these criteria."

Current World Bank president James Wolfensohn, a Clinton appointee, has often said his job under the Bush administration has been made difficult by differences over lending practices.

And certainly the bank's critics believe its purpose has become blurred by the diverse interests of its shareholders.

Carol Graham, a senior fellow at the Washington-based Brookings Institution, said Wolfowitz would profit from his greater political sway.

"If Wolfowitz is sincere in saying he is interested in development ... he could have some advantages that he is clearly an insider and will have the support and respect of the administration in a way that Wolfensohn didn't," she said.

The Bush administration has been criticized for creating development strategies without involving the global lenders.

"Until now the administration and the international financial institutions in general have been operating as separate entities ... so that dynamic may change," Graham added.