Russia challenges EU nominee to head IMF

In apparent defiance of the traditional control held by Europeans in selecting the chief of the International Monetary Fund, Russia has nominated Czech former central bank chief, Josef Tosovsky, to stand against the EU’s chosen candidate, Dominique Strauss-Kahn.

On 22 August 2007, the Russian finance ministry nominated Josef Tosovsky, the current chairman of the Financial Stability Institute in Switzerland, to succeed Spain’s Rodrigo de Rato as managing director of the global lending institution from October onwards. 

The move – which comes one month after EU finance ministers gave their backing to French former finance minister Dominique Strauss-Kahn as the European candidate to head the IMF (EURACTIV 10/07/07) – came as a surprise. According to an unwritten international agreement, the IMF chief is traditionally selected by Europe, while America gets to choose the World Bank president. 

Russia’s nomination of Tosovsky could be viewed as a ploy to put an end to this duopolistic situation, in place since the end of World War II and criticised by Russian President Vladimir Putin as “archaic, undemocratic and inflexible”. But Kremlin spokesman Dmitry Peskov denied any hidden political motivations, saying: “Tosovsky’s candidacy, backed by a number of states, has been proposed for professional reasons.” 

“We have conducted wide consultations with colleagues from other countries and we are certain that the majority want a managing director to be chosen on a competitive basis for professional qualities…That is why we chose to put forward an alternative candidate,” said the Russian finance ministry, which earlier this month criticised European countries for seeming “to have made their decision before all the candidates have emerged”. 

Tosovsky has accepted the nomination, stating: “I am pleased that my proposed nomination received a positive reaction from finance ministers and governors of several countries from all regions.” But the Czech government has not given him its support, saying it had already co-ordinated its position with other EU members and that it “wouldn’t be proper to change that position”. 

Nevertheless, amid demands for a more transparent selection process from countries such as China, India and Brazil, and concerns about France leading the IMF, when it has already held this spot for half of the IMF’s 61 years of existence and when Frenchmen also hold the top seats at the European Central Bank, the World Trade Organisation and the European Bank of Reconstruction and Development, Russia’s candidate could win a fair amount of support. 

Even the UK stressed last month that it wished “to see what other candidates there may be put forward from other parts of the IMF” before granting its definite support to Strauss-Kahn. 

So far, the two men are the only candidates for the top job, but the IMF has said that it will accept applications until 31 August and that the executive board will take a decision in September. 

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