Europe identifies 5 candidates to succeed Christine Lagarde as IMF chief; deadline set for September

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Published: July 27, 2019 12:36:58 PM

A European traditionally runs the Washington-based IMF and the next leader will confront a world economy at its weakest since the aftermath of the financial crisis.

Christine Lagarde resigned this month to lead the European Central Bank. (Reuters File photo)Christine Lagarde resigned this month to lead the European Central Bank. (Reuters File photo)

Europe has identified five candidates to succeed Christine Lagarde as chief of the International Monetary Fund as the lender set a Sept. 6 deadline for applicants.

The contenders are Spanish Finance Minister Nadia Calvino, Portuguese Finance Minister Mario Centeno, former Dutch finance minister Jeroen Dijsselbloem, World Bank chief executive Kristalina Georgieva of Bulgaria and Bank of Finland Governor Olli Rehn, according to a French finance ministry official. Bank of England Governor Mark Carney, an early frontrunner, wasn’t on the shortlist.

Lagarde resigned this month to lead the European Central Bank. A European traditionally runs the Washington-based IMF and the next leader will confront a world economy at its weakest since the aftermath of the financial crisis. Just this week the fund further reduced its global growth outlook, already the lowest since the crisis, to a projected 3.2% expansion this year.

Previously French finance minister before taking over at the IMF in 2011, Lagarde’s resignation is effective Sept. 12. The post she’s vacating has been held by a national of France more than any other country, and it’s France again leading the process of trying to build a consensus. The extra time might help — or perhaps give emerging markets an opening to come up with their won candidate.

The IMF said in a statement Friday that its application process opens July 29 and closes Sept. 6. The Board intends to complete the process by Oct. 4.

With government leaders heading into the summer break, the timing is of particular interest. Europe has traditionally had a lock on the position, but has struggled to get behind any one candidate.

Trying to find someone who can win enough support from European countries has been hard, with the French now looking to widen the field by scrapping the job’s age limit, according to people with knowledge of the talks.

Under a half-century-old agreement, the head of the IMF is a European while the U.S. picks the World Bank chief. That tradition prevailed when the American David Malpass was selected as the World Bank’s president in April.

But Europeans are uncertain whether President Donald Trump’s administration will return the favor — and emerging markets have been arguing for years that the arrangement reflects a world that’s since evolved.

The Candidates:
Calvino: Spain’s finance minister is a Socialist woman from Europe’s south, ticking a lot of boxes at a time when center-right politicians in the region have clinched major roles, while leadership positions in global economic policy remain dominated by men.
Centeno: The Portuguese finance minister and current Eurogroup president is one of the euro-area’s most senior policy makers.
Dijsselbloem: The former Dutch finance minister and head of the Eurogroup, the euro area’s powerful team of finance chiefs, earned the respect of colleagues during the region’s crisis overseeing tough negotiations with Greece and establishing the zone’s banking union.
Georgieva: The Bulgarian chief executive officer of the World Bank and former vice president of the European Commission is well qualified as a trained economist with prior leadership positions at international institutions.
Rehn: The Bank of Finland governor, previously an economy minister and European Union commissioner for economic and monetary affairs, has held several posts that make his resume a strong one. He lost out to Lagarde for the ECB role.

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