EU finance ministers set to vote on Europe’s IMF candidate
EU finance ministers are to vote on Europe’s candidate to succeed Christine Lagarde as the next managing director of the IMF in the hope of breaking an impasse that has divided northern and southern eurozone capitals.
After weeks of negotiations that have failed to reach consensus, ministers from the EU’s 28 national capitals will vote via email on Friday morning on a shortlist of at least four names, according to officials involved in the process.
The decision to hold a vote — an option that had initially been rejected by some capitals including Berlin — is designed to whittle down the possible candidates. It comes after Bruno Le Maire, the French finance minister who has been chairing negotiations, failed to broker a deal.
European diplomats involved in the talks said the decision was designed to pressure some candidates into withdrawing from the race after none of the five candidates in the fray withdrew.
The shortlist is made up of Jeroen Dijsselbloem, the former Dutch chair of the Eurogroup of EU finance ministers, Olli Rehn, Finland’s central bank governor, Nadia Calviño, Spain’s finance minister, and Kristalina Georgieva, the Bulgarian World Bank chief executive.
Candidates must submit their names for inclusion in the ballot by Thursday evening; the vote will be held under the EU’s qualified majority rules in which bigger member states carry more weight. After an initial vote, there could be a second round run-off between the final two candidates.
The UK, which has a new government, asked for more time to consider whether to field a candidate but did not make a nomination before the deadline on Thursday evening.
Former chancellor George Osborne threw his hat into the ring early in the contest but failed to attract much support. Meanwhile, the Canadian Bank of England governor Mark Carney is widely regarded as a competent candidate but deemed by some national capitals “not European enough” — despite holding British and Irish passports.
Traditionally Europe has nominated the head of the IMF while the US chooses one of its nationals to lead the World Bank. Europe’s failure to unite on a candidate has raised expectations that alternative candidates, including Mr Carney, could have a chance.
Europe’s attempt to settle on a candidate has descended into recriminations; EU capitals have remained intractably divided despite the urgency to unite around a candidate in order to prevent emerging economies from rallying around a non-EU candidate.
Southern countries such as Spain, Italy and Portugal have vehemently opposed the candidacy of Mr Dijsselbloem who has the backing of Germany. Northern capitals insist they should get the IMF pick as the eurozone’s economic establishment is dominated by southern European nationals.
In a bid to win over his critics, Mr Dijsselbloem has been on a tour of southern capitals — visiting Madrid and Athens this week. The Dutchman came under fire from southern countries after he failed to apologise for comments where he said crisis-hit countries had wasted their money on “alcohol and women”.
Ms Georgieva, who is from a non-eurozone country, has been pushed by France but has little support among larger EU countries. Her candidacy would require the IMF to change its rules, which prevent candidates over the age of 65 from applying, because she is above the age limit.
France’s steering of the negotiations and support for Ms Georgieva has been criticised by some other EU countries, and forced Paris to enlist the help of Berlin in coordinating a common position.
“We don’t know what their strategy is or what they want to achieve,” said one EU ambassador.
The IMF has set a September deadline for nominations and hopes to conclude the process in early October.