A Stellar Leader Is Crucial to IMF

Selecting a new boss at the International Monetary Fund is turning into something of a farce. After four months of transatlantic arm-twisting, abstainers’ “none of the above” votes prevailed in a straw poll that IMF directors took last Thursday. But that was a better result than electing the front-runner, the German deputy finance minister, Caio Koch-Weser, who is clearly not the right person for the job.

The IMF was set up after World War II to stand guard over international monetary stability. It was supposed to help a country in financial crisis with a quick injection of funds and prevent a national calamity from spreading into a regional or global one. But over the years, it has lost sight of its mission, turning into just another development agency nursing dozens of chronically ailing economies.

Washington and many Europeans agree that the time has come for change. The IMF has to get back to its mission of monitoring national economies and offering short-term emergency loans. The fund also must be held more accountable to both lender and borrower countries and open its documents for public review.

Koch-Weser, a World Bank veteran, has neither the leadership qualities nor the experience for this task. He was rejected by Washington and got only a tepid endorsement from key European countries.

Traditionally, the IMF top job goes to a European, and President Clinton says he will go along with this practice. Clearly, with 37% of the vote, the European Union carries substantial weight at the IMF.

Europe is not short of good candidates. Among them are the respected Bank of France Governor Jean-Claude Trichet and England’s Andrew Crockett, head of the Bank for International Settlements. If none of them are acceptable to all the key countries, the governments should look for a qualified candidate outside of Europe. The IMF is up for a radical overhaul soon and should act with dispatch. The priority should be on picking the right leader.