French finance minister Christine Lagarde has garnered considerable support from Asian finance ministers and others at the ADB annual meeting in Hanoi for what could be a bid to become the next managing director of the IMF.
Lagarde has been rumoured to be among possible candidates for the IMF job. And the respect she has gained on what some see as a support-canvassing trip to Asia – a region that has long pushed to nominate its own candidate – could strengthen her chances, should she run.
ADB president Haruhiko Kuroda suggested to Emerging Markets that Lagarde would be a “perfect” candidate. Kuroda had himself been seen as a possible successor to current IMF managing director Dominique Strauss-Kahn, but has recently expressed a desire to stay on as president of the ADB when his current five-year term ends in November.
The issue is drawing attention because Strauss-Kahn could quit his post in the coming months and return to France, to seek nomination as Socialist candidate in the presidential election due to be held early next year.
Lagarde told Emerging Markets that her attendance at the annual meeting was an “outreach” trip to brief Asian financial leaders on President Nicolas Sarkozy’s agenda to reform the international monetary system under France’s chairmanship this year of the G20.
Anoop Singh, director of the IMF’s Asia Pacific Department, said it was a successful “support-winning” mission for the G20 agenda among the important and increasingly influential Asian constituency.
But it was also seen by some as a bid to win support for the IMF's top job. Indonesian finance minister Agus Martowardojo told Emerging Markets that if Lagarde emerges as a candidate for the IMF job then “I will recommend it.” Her experience as an international lawyer and finance minister make Lagarde a “very suitable candidate,” he added.
Bangladesh finance minister Abul Maal Muhith said: “She would be a very good candidate.” Bakoa Kaltongga, minister of finance of Vanuatu said “we would have no qualms with her” and that: “I’m sure quite a number of more powerful Asian countries would consider her nomination.”
Three of these more powerful countries - Japan, China and India - were more reticent, however, perhaps because of what some suggest is growing competition among them to nominate their own candidate to head the IMF.
China’s vice finance minister Li Yong declined to comment, and Indian finance minister Pranap Mukhergee said only “let us wait and see.” Japan’s finance minister Noda declined comment.
Former World Bank official Harinder Kohli told Emerging Markets: “I think right now they [Japan, China and India] are trying to figure out a pecking order” in nominating a candidate for the IMF.
“The issue is, would Japan, China and India agree on a candidate, or not. I’m not sure they have yet [reached agreement]. In that case, by default, it’s going to go back to the Europeans,” said Kohli, who is now president and CEO of consulting firm Centennial Group.
Lagarde’s chances of becoming the next IMF head, should she be nominated, would be strengthened by the fact that another possible runner, Britain’s former prime minister Gordon Brown, appears to be out of contention. His successor David Cameron recently expressed reluctance to support him.
Another factor, an IMF source told Emerging Markets, is that the Fund has become much more closely engaged with Europe since the sovereign debt crisis erupted in Greece and elsewhere, and that the IMF now has three programmes in Europe.
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