December 6, 2023

A Shaken Agency Looks to the Future

The abrupt resignation of Dominique Strauss-Kahn late Wednesday night has brought tensions long simmering beneath the surface at the powerful organization to a boil.

Nations like Brazil want a more open process that does not see the top position at the I.M.F. granted to a European, as has been the convention since the fund was founded 65 years ago. They hope instead to put forth a credible candidate from the emerging world to reflect its growing economic clout.

“We must establish meritocracy, so that the person leading the I.M.F. is selected for their merits and not for being European,” Guido Mantega, Brazil’s finance minister, said late Wednesday

China, too, publicly weighed in on the debate, suggesting that achieving a consensus on the successor to Mr. Strauss-Kahn may take several months. “In principle, we believe that emerging and developing countries should have representation at senior levels,” a Chinese foreign ministry spokesman said Thursday, the second such statement in two days.

Politicians from across Europe closed ranks, appearing to coalesce behind Christine Lagarde, France’s finance minister, as their preferred candidate to succeed Mr. Strauss-Kahn, who is also French.

Chancellor Angela Merkel of Germany publicly called for a European to assume the job, arguing that the Continent’s festering economic problems required a European to stay in place. German media reported that she favored Ms. Lagarde.

“Of course, developing nations are within their rights in the medium term to occupy the post of either I.M.F. head or World Bank chief,” Mrs. Merkel said, according to news reports. “But I think that in the current situation, with serious problems with the euro and the I.M.F. strongly involved, there is a lot in favor of a European candidate being put forward.”

In Washington, the I.M.F. said the 24-member executive board had begun discussions about the selection process for the new managing director. The board is scheduled to hold its regular weekly meeting on Friday when the timetable for succession, like deadlines for nominations, may be discussed. Countries will nominate their candidates, and then the board will vote, with large financial contributors like the United States and Japan getting a bigger share of voting rights. The entire process could take months, as it has in the past.

But the real negotiations and horse-trading have already shifted back to national capitals; one issue being discussed is whether a European would serve out the remaining year and a half of Mr. Strauss-Kahn’s term, before handing over to a candidate from the emerging nations, or, more likely, whether a new head should be elected to serve a full five-year term.

President Nicolas Sarkozy of France spoke with Mrs. Merkel by phone Wednesday and will speak with Prime Minister David Cameron of Britain on Friday about succession, said an official in Mr. Sarkozy’s office who spoke on condition of anonymity. President Obama and other heads of the Group of 8 industrial powers will also discuss the matter when they meet in Deauville, France, next week, the official said.

Support from the United States is crucial. At 16 percent, it has the single biggest voting share on the fund’s board. Together, the United States and numerous European countries control more than 50 percent of the voting shares.

On Thursday, Treasury Secretary Timothy F. Geithner said the United States wanted a “prompt succession,” perhaps suggesting the United States is interested in promoting a quick changeover that leaves a European in charge and does not disturb the status quo.

But he said the United States also wanted to see an “open process,” stopping short of endorsing Europe’s claim. The United States faces a sensitive task over the next few months, risking confrontation if it backs a European candidate, leaving room for countries with developing economies to come up with a credible candidate of their own.

Katrin Bennhold, Keith Bradsher and Edward Wyatt contributed reporting.

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