Open letter demanding a fair selection process for the next IMF managing director

To governors and executive directors of the IMF,

The ‘gentleman’s agreement’, which has ensured that the IMF managing director has, for 75 years, been European and the World Bank president a US national, is undemocratic, illegitimate, and rooted in neo-colonial principles.  

International institutions currently face a crisis of legitimacy, as faith in the multilateral system of global governance withers. If the IMF and World Bank want to present themselves as modern institutions capable of tackling today’s challenges, it is imperative that they become democratic and accountable to all of those they represent.

Despite over 150 civil society organisations and individuals calling on the World Bank for an open, transparent and merit-based leadership succession process earlier this year, the US candidate David Malpass was appointed president of the World Bank. This, exacerbated by the fact that the only other nominee cited pressure from “other governments” as the reason for withdrawing, brought global governance into further disrepute.

It is high time to end the ‘gentleman’s agreement’ and replace it with a genuinely open, democratic, merit-based, transparent process, that goes beyond rhetorical commitment, and allows candidates, regardless of nationality, to be put forward on an equal footing. In line with longstanding civil society demands, we believe that no country – or indeed bloc of countries – should wield excessive power in this process. Instead, the winning candidate should gain support of a majority of both voting shares and member states.

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Call on civil society organisations and academics to sign the campaign Letter to end the ‘gentleman’s agreement’

The ‘gentleman’s agreement’, which has ensured that the IMF managing director has, for 75 years, been European and the World Bank president a US national, is undemocratic and illegitimate. 

Bretton Woods Project, alongside our global partners, has drafted a campaign letter to be sent to IMF executive directors, governors and deputy governors, calling on them to bring about a genuinely open, democratic, merit-based, transparent process, that goes beyond rhetorical commitment, and allows any government, regardless of nationality, to put forward candidates on an equal footing.

If you are a civil society organisation or an academic interested in supporting the campaign, send an email to mbrett@brettonwoodsproject.org, who will send you a copy of the letter to sign. The deadline for signatures is close of play on Thursday 15th August.

75 years is enough – It is time to end the ‘gentleman’s agreement’.

In the news

• IMF nominee a sign of W. Europe losing hold, China Daily.
• The new IMF head should not be dictated by the tired, old, EU order, Financial Times.
• Indonesia backs Georgieva nomination for new IMF chief, Jakarta Post.
• Lagarde’s resigning brings opportunity to reform IMF, Global Times.
• Towards A New Multilateralism for Shared Prosperity, Bretton Woods Committee.

In the news

• Look to south-east Asia for next IMF chief candidate, Financial Times.
• EU nominates Kristalina Georgieva as the next IMF chief, CNBC.
• IMF’s top job shouldn’t be another stitch-up, Bloomberg.
• The new IMF chief should not be chosen by Europe alone, Guardian.
• Europeans going round in circles on IMF job as irritation grows, Yahoo Finance.
• No EU consensus on new IMF chief to replace Lagarde: French government, the Straits Times.
• EU finance ministers set to vote on Europe’s IMF candidate, Financial Times.
• Europe splits over IMF leadership, Euractiv.
• Next IMF chief must be ‘ready to go to war’ – trade and currency, strategist says, CNBC.

Will the IMF change its managing director age limit to suit the Europeans?

The maximum age for a candidate to be appointed Managing Director is currently under 65 years old, and currently stipulates that this person cannot hold the position of managing director beyond their 70^th birthday. However, rumours have been circulating as to whether the Fund will scrap this to shoehorn in a favoured European candidate.

Kristalina Georgieva, who is currently the World Bank chief executive and a Bulgarian national, is rumoured to be backed by the French in the leadership race. France plays a particularly powerful role in the selection process as Bruno Le Maire, the French finance minister, is coordinating the European selection process. Georgieva is however 65 years old, meaning that should she be appointed, the IMF would need to change its age limit rule.

It was reported in the Financial Times on July 26 that France had floated the option of changing the age limit, but that did not attract support from the board on Friday . The Financial Times article added that “Nonetheless, people familiar with the matter said the age limit could still be tweaked at a later stage if Ms Georgieva emerged as the board’s choice.”

Just on the same day as the publication of the article – and on the same day that France floated the age limit change – the IMF published an update entitled “Frequently Asked Questions on Managing Director (MD) Selection”. The update had a section at the very bottom of the page entitled “How can the age limit be changed? When can it be changed?”, which noted that: “The Fund’s By-Laws would need to be amended by the Board of Governors by a majority of the votes cast. The age limit could be changed either before or after the nomination period closes. A nominee who is above the age limit could not be appointed Managing Director until the By-Laws were amended to remove or modify the age limit.”