The regional squabbles over IMF leadership have started up, according to a Bloomberg report today. As can be expected, European officials are defending their hold on the post and emerging economies calling for change, while the U.S. and China watch from the sidelines.
U.S. Treasury Secretary Timothy Geithner, Austrian Finance Minister Maria Fekter and Spanish Finance Minister Elena Salgado have all urged that a replacement for Dominique Strauss-Kahn to be found quickly. European officials are insisting that a European needs to be named while the region’s sovereign-debt crisis continues.
“We are in a very difficult European situation and it’s quite natural that we would have a strong European influence in the IMF,” Sweden’s [Finance Minister Anders] Borg told reporters in Brussels.
The apparent front runner among Europeans is French Finance Minister Christine Lagarde (perhaps due to a Daily Show bump?). The U.S. is pushing for a quick decision on Strauss-Kahn’s successor regardless and China has stated only that the process must be a “fair and transparent process.” Emerging economies raised their usual and predictable objections to a continued European hold on the post.
South African Finance Minister Pravin Gordhan said a candidate from a developing country should be given the opportunity to get the job. Bank of Korea Governor Kim Choong Soo echoed that sentiment today in Seoul, saying: “I hope this will be an opportunity for a country in the emerging economies to take the post.”
Morris Goldstein, with the Peterson Institute for International Economics and a former IMF official, suggested there are number of qualified individuals, but that they won’t get a hearing unless the emerging economies quickly unite around a single candidate.
Goldstein, the Peterson Institute fellow, said there are several potential candidates from emerging markets, including Singapore Finance Minister Tharman Shanmugaratnam, former Turkish Economic Minister Kemal Dervis and India’s Montek Singh Ahluwalia, currently the deputy chairman of the nation’s Planning Commission. Turkish Finance Minister Mehmet Simsek said there’s no reason he couldn’t do the job.
Kevin Rafferty, writing in the Japan Times, also suggests Tharman as a strong contender from outside Europe, as well as Eduardo Aninat (Chile), Arminio Fraga (Brazil), Trevor Manuel (South Africa), Korn Chatikavanij (Thailand) or current Managing Director at the World Bank, Ngozi Okonji-Iweala (Nigeria).
“If they are serious about this and they really think it’s time for them to put forward a candidate and get the job then they have to get moving,” [says Goldstein]. “If they do nothing and wait and wait and wait it will again be a European.”
