October 20, 2020

French Minister to Seek Top I.M.F. Job

Declaring her candidacy at a news conference called only the night before, Ms. Lagarde said that being European should not disqualify her and that she would be traveling over the next few weeks to listen to and seek support from other I.M.F. members.

“Being a European shouldn’t necessarily be a plus, but it shouldn’t be a minus, either,” she said.

Given that Europe’s festering sovereign debt crisis is the biggest problem facing the fund — and the reason European leaders have cited for wanting to hold on to the post for now — Ms. Lagarde said her intimate knowledge of the issues and the players involved can help.

Ms. Lagarde has a prominent profile in France, Europe and in the world of international finance. She has played a key role in managing the euro crisis at a pivotal point in its history. Moving to the I.M.F. would elevate her even more on the global stage.

She already has support from Chancellor Angela Merkel of Germany; the British chancellor of the exchequer, George Osborne; and most of Europe’s political establishment. That made her the front-runner to succeed Dominique Strauss-Kahn, who resigned from the I.M.F. last week to fight charges that he sexually assaulted a maid in a New York hotel.

At the news conference, Ms. Lagarde made clear that she wants a full five-year term and is not seeking to just finish out the remaining 18 months of Mr. Strauss-Kahn’s term. Tanned and smiling, she also said that she had spoken with her main rival, the Mexican central bank governor Agustín Carstens, two days ago and that “we are happy with the competition.”

Still, the selection process for the job has drawn increasing criticism from leaders of big emerging countries, who are gaining influence in the world as debt crises and economic downturns plague Western countries.

Late Tuesday in Washington, the I.M.F. representatives from Brazil, Russia, India, China and South Africa issued a firmly worded statement condemning the “obsolete, unwritten convention” of reserving the top job for a European, saying that making a selection on the basis of nationality “undermines the legitimacy of the fund.”

The statement stopped well short of rejecting Ms. Lagarde’s candidacy but said technical background and political acumen, rather than nationality, should be the main factors in choosing future managing directors.

It also underscored what has become in increasingly common refrain among emerging market nations on the global stage: that the gradual shift in economic and demographic influence to rapidly developing countries should be reflected in international institutions.

“Adequate representation of emerging market and developing members in the fund’s management is critical to its legitimacy and effectiveness,” the group’s statement said.

Yet in the absence of any consensus among emerging market nations on a candidate from their ranks, there appeared to be little to indicate that a bid by Ms. Lagarde would be derailed.

Arvind Virmani, who represents India and three other countries on the I.M.F. board, told Bloomberg News that it was unlikely that a candidate from an emerging market would be able to beat her. “There is no indication which suggests that the result will be any different this time,” he said.

But one thing that could throw a shadow on her candidacy involves her role in getting a case involving a supporter of President Nicolas Sarkozy sent to arbitration. Ms. Lagarde was peppered with questions during the press conference about whether she abused her authority in a case that resulted in a lucrative arbitration award to a French businessman, Bernard Tapie, in 2007.

French judges have until June 10 to decide whether to investigate the charges. Ms. Lagarde said she would maintain her candidacy even if judges decided to open an official inquiry.

“I have a perfectly clear conscience, and I operated with total respect for the law,” she said.

Bettina Wassener contributed reporting from Hong Kong.

Article source: http://feeds.nytimes.com/click.phdo?i=2ad3749e51ab4fe79da0b5661693a402

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