Bulgarian World Bank chief Kristalina Georgieva set to lead IMF

Georgieva (above) was chosen after more than 12 hours of talks and votes amid divisions within the 28-nation bloc.
Georgieva (above) was chosen after more than 12 hours of talks and votes amid divisions within the 28-nation bloc.PHOTO: REUTERS

65-year-old Kristalina Georgieva defeats Dutch candidate after backing from EU states

BRUSSELS (REUTERS) • European Union governments picked Bulgaria's Kristalina Georgieva as the bloc's candidate to lead the International Monetary Fund (IMF) after more than 12 hours of talks that highlighted the EU's internal divisions.

The 65-year-old chief executive of the World Bank got the backing of a majority of the 28 EU states, defeating the Dutch candidate Jeroen Dijsselbloem after two rounds of voting and prolonged negotiations among EU nations.

"Congratulations Georgieva for being selected as European candidate to lead the IMF. In the face of rising global tensions, it is imperative to uphold the IMF as a symbol of multilateralism," said the chairman of euro zone finance ministers, Dr Mario Centeno.

Dr Georgieva is a centre-right politician who grew up in Bulgaria under communism before a career that took her to the top of the World Bank and the European Commission.

Most EU states backed Dr Georgieva even though her candidacy would force a change in IMF rules that require the managing director to be younger than 65 years old when appointed. The need for that change could weaken the European candidate if a sufficiently large number of IMF member states oppose the reform.

However, a European official said that support from EU countries and the United States would be enough to overhaul the rules in the global fund that has historically been dominated by the Western bloc. According to an IMF fact sheet, a bylaw change to remove or modify the age limit would require approval by a majority of board votes cast.

The source added that France, which is leading the European selection process, had already secured Washington's support on this change.

 

A US Treasury spokesman could not immediately be reached for comment on Dr Georgieva's nomination, but US Treasury Secretary Steven Mnuchin spoke highly of her work in a Reuters interview last month.

The top job at the Washington-based world lender has always been filled by a European. The former IMF chief, France's Christine Lagarde, resigned last month after EU leaders chose her to replace Dr Mario Draghi as European Central Bank president.

Candidates for the head of the IMF can be fielded until Sept 6.

Other world powers and emerging countries are expected to submit their candidacies by the deadline. The IMF plans to select its new head by Oct 4.

If Dr Georgieva ends up replacing Ms Lagarde, she will have to decide how much to embrace the effort to reshape the institution from one renowned for pushing troubled countries to embrace tight budgets.

Ms Lagarde tried to give emerging economies, such as China, more of a voice in the lender's management, while putting greater emphasis on issues such as climate change and income and gender inequality.

The new managing director will also be tasked with coordinating relations with Argentina after the IMF last year gave it the biggest-ever bailout. Also in the in-tray will be a request for governments to provide more capital, a push the US has so far resisted.

Better known in Brussels and in Washington than her home country, Dr Georgieva is a proponent of gender equality and the fight against climate change. Alongside her international-development work, she has written a textbook on microeconomics.

A version of this article appeared in the print edition of The Sunday Times on August 04, 2019, with the headline 'Bulgarian World Bank chief set to lead IMF'. Print Edition | Subscribe