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We at CGD warmly welcome president-elect Barack Obama's appointments of Timothy Geithner as Secretary of Treasury and Lawrence Summers to head the National Economic Council. Both are members of the CGD Board of Directors. This is no coincidence.
Late last week, Democratic presidential candidate Hillary Rodham Clinton announced her global development agenda, promising to fight HIV/AIDS, end malaria deaths, continue her leadership on basic education for all, expand women's opportunity and children's health, eliminate poor country debt, and improve U.S. development assistance.
Good news! The IMF has finally moved forward on Liberian debt relief. Yesterday's IMF announcement that it has agreed on the necessary financing was a strong endorsement by the international community of Liberia's progress under its new government. It took more than a year of pushing and prodding, but Liberia now can formally begin the debt relief process.
The IMF's 2007 World Economic Outlook has a chapter on inequality and globalization (Chapter 4), which concludes that globalization in the last two decades has contributed to increased inequality in most countries. Bravo to the IMF for daring to move, on globalization, from apparent unencumbered globaphile to concerned realist!
Agence France Presse reported last week that Dominique Strauss-Kahn, France's candidate to head the IMF, told Brazilian President Luiz Inacio Lula da Silva that he wants to reform the IMF--including how the head of the international lender of last resort is selected. Marco Aurelio Garcia, Lula's advisor for international policy, briefed reporters after the two men met. According to AFP:
He said the Socialist party leader and former French finance minister told Lula change was needed in the IMF in "three key areas," including how member states were represented, how its managing director is selected and its operating program....
Strauss-Kahn after his meeting with Lula told reporters, "If I am a candidate, it is because I want to change the IMF."
Last Friday the IMF board announced that it would accept nominations to replace Rodrigo de Rato as the next Managing Director until August 31, a first and essential step in opening up the process of selecting the IMF leader. The board also announced the skills and qualities it seeks in the next Managing Director:
Oops. When I posted yesterday, I hadn’t seen an FT article (UK Calls to Open up IMF Chief Selection) reporting that the UK was attempting to "apply the brakes" and not be pushed into a "quick decision" on a single EU candidate to head the IMF.
It's disappointing to see Europe attempting to preserve the outmoded mid-20th century custom of Europeans naming the head of the IMF, and in exchange letting the U.S. name the head of the World Bank. As the Economist today succinctly described the quickly emerging European consensus on France's nomination of Dominique Strauss-Kahn, a former finance minister of France:
While participating in an interesting and thoughtful eDiscussion organized by the UNDP on Securing Fiscal space for the MDGs, I was struck by how much different approaches to the issue-say between the IMF and the UNDP-are driven by different implicit assumptions about the likely effectiveness of additional spending.
Rodrigo de Rato's announcement Thursday that he will step down as Managing Director at the IMF following the Fund and World Bank annual meetings in October took almost everyone by surprise (see Washington Post article). The timing was especially puzzling, as the announcement comes just as much of Mr. de Rato’s reform agenda is moving from concept to reality. Mr.