The silent starting gun has been fired. After Christine Lagarde’s naming as next European Central Bank president, the runners are already off in the race to succeed her as managing director of the IMF. This is a pivotal role. The multilateral order of which the fund is a pillar is facing multiple challenges. By keeping an American lock on the World Bank with the appointment of David Malpass, the US has perpetuated its half of the unofficial duopoly whereby a European heads the IMF. Yet the scale of the tasks ahead makes it vital the IMF contest is genuinely open and aimed at securing the outstanding candidate, on merit — European or not.
The most important quality is the ability, and courage, to lead. As the premier institution to emerge from the Bretton Woods conference 75 years ago this month, the fund stands for international co-operation at a time when that principle is under threat. The new managing director will need to manage the often contradictory pressures from existing and emerging economic powers, while standing for the IMF’s core principles of partnership, rational policymaking and economic openness.
A second vital quality is political weight. A European MD will have the support of the IMF’s biggest voting bloc. But if the institution is to remain credibly global — and guard against the possibility that China might try to create its own worldwide monetary body — there are strong arguments to reach beyond Europe. To succeed, nonetheless, the new head must be seen as fully credible by both Europe and the US.