Brown, a 51-year-old Briton, a high profile head of the United Nations Development Agency, will take over from 70-year-old Iqbal Riza of Pakistan on January 19.
Riza, who was Annan's close adviser, is officially stated to have asked for retirement.But diplomats note that the reshuffle comes after the Secretary General a group of Americans, who had urged him to undertake a major reshuffle to reburnish world body's image after some Conservative lawmakers had asked for his resignation.
Announcing the appointment Monday, Annan said that "this is the first of changes or shuffle that may happen."
Unlike Riza, Brown, a a former journalist and spokesman of the World Bank, is not media shy and told reporters that he would be available to them for comments, something which earlier Chiefs of Staff have not done.
The appointment comes amidst charges that the world body failed to defend itself aggressively on allegations of corruption in the now defunct "oil- for-food" programme for Iraq, and could not effectively explain the exoneration
Brown would retain his current position as head of the UNDP, the largest UN agency, while the agency deals with the tsunami tragedy and till his replacement is found.
He will accompany Annan to the Indonesian capital of Jakarta for the meeting of Asian leaders Thursday where an appeal for funds to meet the urgent humanitarian needs of the victims would be launched.
Saying that 2005 offered the United Nations a critical opportunity to push through a new round of reforms, Annan said Brown would play a key role in carrying out a series of measures to enhance the effectiveness of the world body.
"As most of you already know, Mark is an immensely capable leader and manager and, in his new role, will assist me and Louise Frichette, my Deputy Secretary-General, in developing and implementing major initiatives to improve the performance and management of the United Nations," he said.
He stressed the upcoming five-year review of the Millennium Development Goals (MDGs) will be a key moment for world leaders to reach an agreement on how best to revitalise the Organisation and ensure it is better equipped to deal with the scale and complexity of 21st century challenges.
