Brazil and U.S. Back Lagarde For IMF Post; Chances Look Dim For Mexico’s Carstens

June 28, 2011 11:40 am 2 comments

French Finance Minister Christine Lagarde leaves IMF headquarters in Washington D.C.

UPDATE: French finance minister Christine Lagarde was named the new head of the International Monetary Fund (IMF) earlier this afternoon.

Mexico’s Agustín Carstens, who Lagarde beat out for the post, said he believes that she will “make meaningful progress in strengthening the governance of the institution.”

Mexico’s central bank chief, Agustín Carstens, put in a good run, but it looks more likely now that France’s Christine Lagarde will be the next managing director of International Monetary Fund (IMF) after receiving the backing of the U.S. and Brazil earlier today.

An unnamed Brazilian government source told Reuters on Tuesday that the country was giving its support to Lagarde. This follows a statement by U.S. Treasury Secretary Timothy Geithner endorsing France’s finance minister.

Geithner praised Carstens for having a “strong and credible candidacy,” but the U.S. endorsement virtually seals a win for Lagarde.

Adding to the two endorsements, Russia’s finance minister, Alexei Kudrin, said that Russia would vote for Lagarde’s candidacy as well.

If the predictions appear true, Lagarde will fill the position vacated by fellow countryman Dominique Strauss-Kahn, who left his post after sexual assault charges were brought against him in New York. Lagarde appointment would continue the legacy of European control of the IMF.

Since the formation of the IMF after World War II, Europeans have monopolized the highest post at the lending institution, with the United States helming the World Bank as part of a six-decade long “gentleman’s agreement.”

Mexico and other countries have argued that the selection process should be based on merit and not nationality and Carstens is adamant that the IMF does not need a European to solve the debt crisis in the euro zone.

Brazil’s backing of Lagarde seems at odds with its argument that it, along with other emerging economies like China and India, are under-represented in the European-controlled IMF. These emerging markets are beginning to hold more influence over the IMF, especially as their economies show signs of growth, while many developed countries – the United States and European nations, for example — are still trying to start-up their own economic growth after the global recession.

Carstens, who gained the backing Latin American nations like Chile and Peru as well as Australia and Canada, believes that emerging markets need to play a much larger role in setting the agenda of the IMF. He also said that the European dependence on the IMF to bail out several of its members could be a challenge to Lagarde’s ability to take a hard stance as the Fund’s leader.

However, with the support of powerhouses like Brazil, the U.S., Russia and several major developing countries, Lagarde has more than half the votes needed to win the top job when the IMF board meets later today.

Photo: International Monetary Fund @ Flickr.

2 Comments

Leave a Reply


Other News

  • Caribbean Puerto Rico Today in Latin America Cocaine Bust in Puerto Rico Points to Island’s New Role in Drug Trafficking

    Cocaine Bust in Puerto Rico Points to Island’s New Role in Drug Trafficking

    Readers, Today in Latin America will be on hiatus until Dec. 1. Happy holidays! Top Story — Puerto Rican authorities on Tuesday announced the seizure of 500 kilograms of cocaine worth approximately $11.5 million, one of the largest drug busts this year. The seizure follows a series of significant drug hauls in the U.S. island territory, pointing to the region’s growing role in the importation of drugs into the United States. Eight people were arrested during the raid, according to […]

    Read more →
  • Central America El Salvador Mexico News Briefs North America As The World Looks To Mexico, News From Another Massacre Goes Unnoticed

    As The World Looks To Mexico, News From Another Massacre Goes Unnoticed

    The world has been focusing for almost two months on the disappearance and reported killing of 43 Mexican students by a drug gang — an act in which government forces played a major role. In the midst of the public outrage surrounding the students’ disappearance, news of another famous massacre by state forces in Central America passed unnoticed. “I am sorry,” the former Salvadoran ambassador to the U.S., Ernesto Rivas Gallont, wrote in a blog post published Oct. 31. He […]

    Read more →
  • Andes Colombia Today in Latin America FARC to Release First Captives, But Warns Over General’s Release

    FARC to Release First Captives, But Warns Over General’s Release

    Top Story — FARC rebels will release two hostages on Tuesday morning, according to a statement issued from Havana by delegates representing the guerrilla group. The release of Gen. Rubén Darío Alzate, the highest-ranking FARC captive in 50 years, is planned for Thursday. However, the statement from Havana warned that the general’s release may be cancelled, owing to the heavy military presence in the province where he is being held. Tuesday’s handover of Pvts. Paulo César Rivera and Jonathan Andrés […]

    Read more →
  • Mexico North America Today in Latin America Fugitive Police Official Captured Over Mexican Students’ Disappearance

    Fugitive Police Official Captured Over Mexican Students’ Disappearance

    Top Story — The former deputy police chief of Cocula, Guerrero, has been arrested in connection with the disappearance of 43 students from nearby Iguala, the Mexican Attorney General’s Office announced on Friday. César Nava González had been on the run since Sept. 26 — the night of the students’ disappearance — and was apprehended on Nov. 16. According to the attorney general’s office, Nava González went into hiding in Mexico City, and then in the city of Colima. He […]

    Read more →
  • North America Today in Latin America United States Sidestepping Congress, Obama Unveils Plan To Protect 5 Million From Deportation

    Sidestepping Congress, Obama Unveils Plan To Protect 5 Million From Deportation

    Top Story — U.S. President Barack Obama on Thursday unveiled a three-part executive order on immigration that would protect up to five million undocumented immigrants from deportation, sidestepping a year of gridlock over immigration reform in the Republican-led House of Representatives. The president’s plan, presented in a fifteen-minute speech, would also expand border enforcement and facilitate legal immigration for skilled immigrants. Obama stressed that while the nearly five million undocumented immigrants affected would be allowed to register and legally seek […]

    Read more →
  • Central America Honduras Today in Latin America Missing Beauty Queen, Sister, Found Dead in Honduras

    Missing Beauty Queen, Sister, Found Dead in Honduras

    Top Story — The bodies of reigning Miss Honduras María José Alvarado, 19, and her sister Sofía, 23, were found in a riverbank grave in an area west of the capital city, Tegucigalpa, police announced Wednesday. Since the sisters went missing on Nov. 13, their disappearance has become national news in the country with the world’s highest peacetime murder rate. Sofía Alvarado’s boyfriend, Plutarco Ruiz, has been arrested and is considered the main suspect in the killings. Aris Maldonado, an […]

    Read more →
  • Andes Colombia News Briefs North America Colombian Government and FARC Agree on Process to Free Kidnapped General

    Colombian Government and FARC Agree on Process to Free Kidnapped General

    An agreement has been reached between FARC rebels and the Colombia government on steps to release Gen. Rubén Darío Alzate, according to a statement released by the Cuban and Norwegian governments, which were involved in brokering the deal. Colombian President Juan Manuel Santos has suspended two-year-old peace talks with the FARC in the wake of Alzate’s capture, insisting that the talks would not resume until Alzate was returned. Alzate, who is the the highest-ranking officer to be taken by the […]

    Read more →
  • Mexico North America Today in Latin America Peña Nieto Says Protesters Seek To Destabilize Mexico

    Peña Nieto Says Protesters Seek To Destabilize Mexico

    Top Story — Mexico’s President Enrique Peña Nieto on Tuesday accused “violent movements” of taking advantage of anger over the September disappearance of 43 students to sow unrest as discontent over the issue shows no sign of abating. His remarks come as pressure builds over the missing students from the rural Ayotzinapa teacher training school in Guerrero state, who officials recently said corrupt local police arrested and turned over to a drug gang, which killed them and incinerated their bodies. […]

    Read more →
  • Andes Peru Today in Latin America Report Highlights Activist Murders in Peru Ahead of Lima Climate Talks

    Report Highlights Activist Murders in Peru Ahead of Lima Climate Talks

    Top Story — Just two weeks before the U.N. Climate Change Conference begins in Lima, Peru, nonprofit Global Witness has released a widely publicized report naming the country the fourth deadliest in the world to be an environmental or land activist. Since 2002, 57 activists have been killed in Peru, more than half of them in the last four years. Peru is facing international scrutiny due to the slow pace of an investigation into the Aug. 31 killing of four […]

    Read more →
  • Brazil Southern Cone Today in Latin America Brazil Arrests 27 in Petrobras Corruption Scandal

    Brazil Arrests 27 in Petrobras Corruption Scandal

    Top Story — Brazilian authorities on Friday arrested 27 people in connection with an investigation into a multibillion-dollar corruption scheme at the state-run oil company Petrobras. Among the 27 was the firm’s engineering director, the second senior executive to be arrested in connection with the scandal. Following the arrests, President Dilma Rousseff said that the “symbolic case” would change Brazilian society forever. Rousseff served as energy minister under her predecessor, Luiz Inácio Lula da Silva. The investigation began when a […]

    Read more →