United States balked Thursday at backing a European to lead the International Monetary Fund, saying only that it wanted an open and prompt succession.
The resignation of Dominique Strauss-Kahn of France has set off a scramble to find a new leader for the powerful organization, which directs billions of dollars to troubled nations to stabilize the global economy.
The United States was responding to reports that it would back French Finance Minister Christine Lagarde, a favorite in many European capitals.
Europe staked its traditional claim to the post. But fast-growing nations such as China and Brazil said it was time to seek an IMF chief from a developing country.
The United States, which has the largest share of votes for a single country, declined to publicly weigh in.
At a court hearing Thursday, a judge agreed to free Strauss-Kahn, 62, from Rikers Island jail on the condition he post $1 million in bail and remain under house arrest, watched by armed guards at a Manhattan apartment rented by his wife. Strauss-Kahn was formally indicted at the hearing on charges of sexually abusing a hotel maid.
The ruling didn’t immediately free Strauss-Kahn. Authorities were reviewing the security arrangements involved in his house arrest.
The managing director post has traditionally gone to a European for 65 years but is now in the sights of fast-growing developing economies who argue it is time for a change.
John Lipsky, the IMF's American No. 2 who is now the acting chief, said on Thursday members agreed "the process of selection of the managing director should be open, transparent and merit-based."
But a sense of inevitability was growing that Europe would retain the post. Lagarde, France's finance minister, was seen as the most likely choice.
While U.S. Treasury Secretary Timothy Geithner called for an "open process that leads to a prompt succession," sources in Washington said the United States, the IMF's biggest financial contributor, would back a European.
The issue will probably be discussed at a summit of Group of Eight leaders in France next week. Together, the United States and European nations hold more than half of the IMF's voting power, giving them a big say over who leads it.
The IMF board was due to hold a regular meeting on Friday to approve its part of a 78 billion euro bailout for Portugal but it was unclear whether it would discuss the process for choosing a new managing director.
John Lipsky, the IMF’s acting managing director, said the organization’s 24-member executive board would begin the process of selecting a new leader.
Besides Lagarde, other potential European candidates include Axel Weber, Germany’s former central bank chief; Klaus Regling, the head of Europe’s bailout fund; and Peer Steinbrueck, a former German finance minister. Candidates from elsewhere include Kemal Dervis, Turkey’s former finance minister; Tharman Shanmugaratnam, Singapore’s finance chief; and Indian economist Montek Singh Ahluwalia.
No comments:
Post a Comment