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Business

Search is on for Strauss-Kahn's successor at IMF

Text by Sébastian SEIBT

Latest update : 2011-05-17

As Dominique Strauss-Kahn’s job at the International Monetary Fund hangs in the balance, speculation is rife about who will replace him as head of the global institution amid conjecture that a non-European may take the top spot for the first time.

Within hours of Dominique Strauss-Kahn’s arrest on Sunday, his second-in-command at the International Monetary Fund (IMF), American economist John Lipsky, was handed the role of acting head of the institution.

While Lipsky is only serving as interim IMF chief, Strauss-Kahn’s chances of returning to the top spot are impossibly slim after he was accused over the weekend of trying to rape a New York hotel employee.
 
The IMF hasn’t officially started looking for Strauss-Kahn’s replacement, but potential candidates and their supporters are already setting the wheels of succession in motion.
 
German Chancellor Angela Merkel on Monday made it clear that she would want the job to remain in European hands. Since its creation in 1944, the IMF has always been headed by a European – in what seems to be part of an unwritten agreement with the United States, which has always secured an American boss to head the World Bank.
 
Others argue that the Strauss-Kahn scandal is an opportunity to bring an end to the European privilege and allow a representative from a developing country to take up the role. FRANCE 24 takes a look at some of the potential candidates.  
 
© Photo courtesy IMF
John Lipsky (USA)
Strauss-Khan himself described Lipsky as “an instigator of debate, an influential proponent of multilateralism and deeper financial surveillance, and an outstanding communicator”. A professional banker, before joining the IMF he was chief economist at US investment giant JP Morgan.
 
Lipsky has said in the past that he had no intention of succeeding Strauss-Kahn, and just a week ago announced that he would stand down from the IMF this summer. Nonetheless, he has taken on the institution’s leading role at a crucial moment. This week, the EU and the IMF must decide whether to offer another bailout to Greece, which could have significant consequences concerning the future of the euro. If Lipsky manages to navigate the Greek issue with success, some may campaign for him to stay on, becoming the first American to head the institution.
 
© Photo credit WEF
Montek Singh Ahluwalia (India)
One of India’s most renowned economists, former finance minister Ahluwalia is currently the deputy chairman of the government’s influential Planning Commission. As the first director of the IMF's independent evaluation office for three years to 2004, he knows the institution inside and out.
 
Gordon Brown (UK)
The former British prime minister probably won’t be averse to the idea of heading the IMF; he already stood for the post in 2007. It was then-prime minister Tony Blair – Brown’s longstanding rival – who blocked his bid to give Strauss-Kahn the job. This time around, it’s current Prime Minister David Cameron who is blocking Brown’s bid. Can he overcome the obstacle this time?
 
© Photo credit WEF
Kemal Dervis (Turkey)
A former Turkish economy minister (March 2001 to August 2002), Dervis is considered to be representative of both a developing country and a driving economic influence in Europe, which could make him a candidate who would be accepted across the spectrum.
 
Currently vice president of the Washington-based Brookings Institution research centre, Demal, like Strauss-Kahn, is an economist who shifted toward politics. He spent almost 25 years at the World Bank (1977-2001) and also headed the United Nations Development Programme (2005-2009).
 
Stanley Fischer (Israel)
Stanley Fischer served as the IMF’s first deputy managing director (1994-2001) and later as special adviser to the managing director from 2001-2002. He is also a former vice president of development economics and chief economist at the World Bank (1988-1990) and a former head of the economics department at MIT.
 
© Photo: Medef

Christine Lagarde (France)
Lagarde is widely respected internationally, but is a French successor to Strauss-Kahn likely? President Nicolas Sarkozy’s current economy minister enjoys a good reputation within financial circles, although she recently found herself in hot water politically over the “Tapie Affair”. Her silence on the issue has only fuelled suspicions. And after the fall of Strauss-Kahn, a French candidate would likely have many other obstacles to overcome.  
 
Trevor Manuel (South Africa)
Finance minister from 1996 to 2009, Manuel’s steady track record makes him one of the strongest candidates from a developing country. In February he was nominated to run the International Monetary and Financial Committee (IMFC), the 24-nation steering panel of the IMF.
 
© Photo: India Economic Summit

Tharman Shanmugaratnam (Singapore)
The most likely candidate from Southeast Asia’s developing countries, Shanmugaratnam is the Singaporean finance minister. But even more impressively, he was the first Asian chief of the IMF’s influential policymaking committee, the IMFC (he beat South Africa’s Trevor Manuel to win the post). He would probably be backed by China, which is unlikely to put forward its own candidate if Shanmugaratnam were in the race to succeed Strauss-Kahn.
 
© Photo courtesy Axel Weber
Axel Weber (Germany)
This is German Chancellor Merkel’s dream candidate. She already tried to propel the former Bundesbank (German federal bank) boss into the position of European Central Bank chief earlier this year, but Weber himself withdrew from the competition. Would he find the IMF job more appealing?

 

 

 

Date created : 2011-05-17

  • FINANCE

    French minister emerges as potential successor to IMF chief

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  • ECONOMY

    IMF names interim head after Strauss-Kahn’s arrest

    Read more

  • JUSTICE

    IMF immunity unlikely to protect Strauss-Kahn

    Read more

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