Will Mexico back Carstens as the next IMF managing director?

In an interview with Bloomberg published on July 29, Andres Manuel Lopez Obrador (ALMO), Mexico’s President, noted that he would support former central bank governor who now heads the Bank for International Settlements, Agustin Carstens, should Carstens be nominated as a candidate.

ALMO noted that despite their “political differences”, he would hypothetically support Carstens, stating that: “I would like to. I would always support a Mexican, if they’re a specialist in the material…” Earlier this month, Carstens declined to comment as to whether he would be eager to run for the position of IMF managing director.

The discussion around Carstens potential candidacy will conjure up memories of the 2011 leadership race for the IMF managing director. Carstens was shortlisted alongside Christine Lagarde for the position, following the resignation of former head of the IMF Dominique Strauss-Kahn, who was arrested in the US on charges of an alleged sexual assault.

Carstens, however, subsequently failed to galvanise support among emerging economies, who are structurally underrepresented in the current IMF governance configurations. Interestingly, as part of his bid, Carstens noted that should the IMF follow through with the ‘gentleman’s agreement’ and select a European candidate for the post, it may produce a conflict of interest, as Europe struggled with a post-crash debt crisis. He noted: “We could have a situation where borrowers dominate the institution,” stressing that the European region needed a fresh perspective in order to solve the problem.

The latest development coincides with Europe’s attempt to nominate an IMF managing director candidate falling in to “disarray”, as Mahreen Khan from the Financial Times noted on Twitter, stating that the French finance minister, Bruno Le Maire, who is in charge of negotiations, has asked Germany for help “coordinating”.

Khan stated that the decision to ask Germany to help manage the endeavour comes after European nations failed to build consensus around a single candidate and amid criticism over the way in which France has reportedly thrown its weight Kristalina Georgieva, who is currently the chief executive of the World Bank and a Bulgarian national.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s