IMF: Two leadership candidates, big controversy

The deadline closes Friday for nominations for the top job at the International Monetary Fund. Two Europeans are vying to lead the global financial institution amid calls for reform, AFP reported. IMF: Two leadership candidates, big controversy The frontrunner, the European Union's candidate Dominique Strauss-Kahn, a former French finance minister, is competing against Josef Tosovsky, a former Czech prime minister and central bank chief nominated by Russia. The deadline closes for nominations at midnight (0400 GMT Saturday) but the likelihood of a new contender appears nil. Both Europeans have hit potholes in recent days: Strauss-Kahn on his merits, Tosovsky on his communist past and Russian sponsorship. Yet it is discontent with the unspoken agreement -- which gives Europe the choice of the IMF chief and the United States that of the World Bank -- that has cast this race as a possible watershed in the 63-year-old institution. The IMF, in announcing the search for a successor to managing director Rodrigo Rato, stressed the winning candidate could be a national of "any" of its 185 member countries and pledged a transparent process based on merit. Developing countries in particular had called for an open selection for the head of the IMF and its sister institution the World Bank and have pushed for greater weight at the Washington-based bodies. On Wednesday, African Union chief Alpha Omar Konare criticized the selection process as "not reflecting the balance of powers in the world today." Luxembourg's prime minister, Jean-Claude Juncker, who also heads the Eurogroup finance ministers, offered an olive branch the next day, saying developing countries could choose the next IMF head if they accept Strauss-Kahn. "Within the Eurogroup and among the EU's finance ministers, everybody agrees that Strauss-Kahn will probably be the last European to lead the IMF in the foreseeable future," he said in a newspaper interview. Repeated requests this week for comment from the Group of 24 developing countries, which includes China, India and Brazil, were not answered. Russia, in nominating Tosovsky last week to challenge Strauss-Kahn, said it was acting to contest the unwritten rule. "Not everyone agrees with this," Foreign Minister Alexei Kudrin said. "It's unfair to leading countries in the world." In a scathing editorial Tuesday, the Financial Times condemned the EU's "carve-up" in selecting Strauss-Kahn, "a man who is neither qualified nor legitimate." The influential British business newspaper said only those who wanted the IMF "to be irrelevant" could applaud the 27-nation bloc's decision. Russia's executive director at the IMF, Aleksei Mozhin, said Strauss-Kahn was a "career politician" unqualified to head the institution. "There is nothing in Mr. Strauss-Kahn's curriculum vitae which could make it clear he has the necessary technical skills to do the job," Mozhin said in an interview with the Financial Times. Rato's exit comes at a sensitive moment as the Fund struggles to find its bearings amid internal reform launched by Rato himself in 2005 and as a rising number of countries opt not to borrow from it. The bruising controversy over the selection of his successor also further erodes the shrinking stature of the fund, whose resources are now dwarfed by global currency reserves. Increasingly, the Financial Times observed, the IMF’s "only assets are political legitimacy and intellectual authority." The candidates will be interviewed in early September and there is no timetable for the final selection, an IMF spokesman told AFP, noting that Rato, who is stepping down nearly two years before his term ends, would not be leaving office until after the annual meetings in late October. The United States, the biggest stakeholder, has declined to take sides publicly in the race. Treasury Secretary Henry Paulson called Strauss-Kahn "a strong candidate" when they met last month as the Frenchman toured world capitals campaigning for the job.

IMF: Two leadership candidates, big controversy

The frontrunner, the European Union's candidate Dominique Strauss-Kahn, a former French finance minister, is competing against Josef Tosovsky, a former Czech prime minister and central bank chief nominated by Russia.

The deadline closes for nominations at midnight (0400 GMT Saturday) but the likelihood of a new contender appears nil.

Both Europeans have hit potholes in recent days: Strauss-Kahn on his merits, Tosovsky on his communist past and Russian sponsorship.

Yet it is discontent with the unspoken agreement -- which gives Europe the choice of the IMF chief and the United States that of the World Bank -- that has cast this race as a possible watershed in the 63-year-old institution.

The IMF, in announcing the search for a successor to managing director Rodrigo Rato, stressed the winning candidate could be a national of "any" of its 185 member countries and pledged a transparent process based on merit.

Developing countries in particular had called for an open selection for the head of the IMF and its sister institution the World Bank and have pushed for greater weight at the Washington-based bodies.

On Wednesday, African Union chief Alpha Omar Konare criticized the selection process as "not reflecting the balance of powers in the world today."

Luxembourg's prime minister, Jean-Claude Juncker, who also heads the Eurogroup finance ministers, offered an olive branch the next day, saying developing countries could choose the next IMF head if they accept Strauss-Kahn.

"Within the Eurogroup and among the EU's finance ministers, everybody agrees that Strauss-Kahn will probably be the last European to lead the IMF in the foreseeable future," he said in a newspaper interview.

Repeated requests this week for comment from the Group of 24 developing countries, which includes China, India and Brazil, were not answered.

Russia, in nominating Tosovsky last week to challenge Strauss-Kahn, said it was acting to contest the unwritten rule.

"Not everyone agrees with this," Foreign Minister Alexei Kudrin said. "It's unfair to leading countries in the world."

In a scathing editorial Tuesday, the Financial Times condemned the EU's "carve-up" in selecting Strauss-Kahn, "a man who is neither qualified nor legitimate."

The influential British business newspaper said only those who wanted the IMF "to be irrelevant" could applaud the 27-nation bloc's decision.

Russia's executive director at the IMF, Aleksei Mozhin, said Strauss-Kahn was a "career politician" unqualified to head the institution.

"There is nothing in Mr. Strauss-Kahn's curriculum vitae which could make it clear he has the necessary technical skills to do the job," Mozhin said in an interview with the Financial Times.

Rato's exit comes at a sensitive moment as the Fund struggles to find its bearings amid internal reform launched by Rato himself in 2005 and as a rising number of countries opt not to borrow from it.

The bruising controversy over the selection of his successor also further erodes the shrinking stature of the fund, whose resources are now dwarfed by global currency reserves.

Increasingly, the Financial Times observed, the IMF’s "only assets are political legitimacy and intellectual authority."

The candidates will be interviewed in early September and there is no timetable for the final selection, an IMF spokesman told AFP, noting that Rato, who is stepping down nearly two years before his term ends, would not be leaving office until after the annual meetings in late October.

The United States, the biggest stakeholder, has declined to take sides publicly in the race.

Treasury Secretary Henry Paulson called Strauss-Kahn "a strong candidate" when they met last month as the Frenchman toured world capitals campaigning for the job.