Europe and developing world square off over IMF post
US: Battle lines were shaping up over the choice of a new leader for
the International Monetary Fund on Thursday as the Fund’s board began
the search for a successor to Dominique Strauss-Kahn.
With the ink barely dry on Strauss-Kahn’s letter of resignation from
a New York jail cell which came five days after he was arrested for
alleged sexual assault European nations moved quickly to keep their lock
on the IMF’s top job.
One after another Europe’s leading figures lined up behind favoured
candidate Christine Lagarde, the respected French finance minister who
like Strauss-Kahn has an intimate knowledge of Europe’s debilitating
But rising powers like Brazil, China and India moved quickly to
prevent a fait accompli with counter-calls for a more transparent
The Fund issued a terse statement Thursday afternoon saying the
search was beginning.
“The dean of the IMF executive board is initiating contacts with his
colleagues today about the selection process for the managing director,”
IMF spokesman William Murray said, referring to Egyptian Abdel Shakour
Shaalan, who represents the Arab states on the 24-member governing
The position is a crucial one in the world economy. The global lender
of last resort, the IMF each year lends tens of billions of dollars to
troubled countries to help right their economies when no others will
But it also lays down strict standards of fiscal and economic reform
for its clients which can upset political and social systems.
The IMF explained that the board would choose a qualified candidate
from any of the institution’s 187 member states.
It also said that, while the board is empowered to vote on the
managing director, it preferred to reach a consensus on the right
person. But after more than six decades of reaching a consensus on only
Europeans, foremost French, some countries and directors were pushing
for a change in the process.
“Consensus is a very flexible word. It can be used at any stage, not
used, it is not transparent. One never knows how this consensus is
achieved, who is achieving this consensus,” Indian IMF executive
director Arvind Virmani told AFP.
“There are a lot of people who feel that the process has not been
credible... that certain countries, certain nationalities were virtually
pre-selected,” he said, speaking in his personal capacity rather than
for his government.
He warned that without a clear-cut nomination and voting process to
replace the backroom politicking of the consensus method, some of the
most qualified and acceptable developing economy candidates might not be
willing to stand.
“The era is over in which it may have been even remotely appropriate
to reserve that important post for a European national,” Brazilian
Finance Minister Guido Mantega said.
“The make-up of top management should better reflect changes in the
global economic structure and better represent emerging markets,” said
China’s central bank chief Zhou Xiaochuan. Washington, AFP