Fischer enters the race; Indonesia & Egypt back Lagarde

The Financial Times today reports that in a surprise move on Saturday, Stanley Fischer, the former Deputy Managing Director of the IMF, nominated himself to become the next Managing Director. He has been mentioned by many as a formidable possible candidate, but at this point his nomination seems mostly a chance to embarrass himself.  As a U.S. citizen working as the Governor of the Central Bank of Israel, Fischer has two nationalities that will count against him with large blocs of voters. And as the smiling enforcer for M.D. Michel Camdessus during the 1990s, he will call to mind some unpleasant memories both in the developing countries where he was instrumental in imposing dozens of structural adjustment programs and the East Asian countries where the IMF led the stringent bailouts resulting from the regional financial crisis.

He did nonetheless have a way of winning the respect, even affection, of the people whose countries the IMF was overseeing, and was nominated in a symbolic move during the 2000  decision-making process when Camdessus finally resigned after 13 years at the helm.  His chances seem little better this time around. Mohammed el-Erian, the CEO of Pimco and himself a symbolic nominee for the post in 2004, is described in the FT article saying Fischer “‘would likely prevail in an open, transparent and merit-based selection process’, but questioned whether European attempts to maintain one of their own as IMF managing director could be overcome.”

In a sign that the race may be winding up anyway, the FT in the same article reports that Egypt and Indonesia have announced they will support French finance minister Christine Lagarde, the front-runner, and her main challenger Agustin Carstens, is getting slightly more personal in his campaigning (pointing out that he’s an economist and she isn’t).


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