WASHINGTON, July 12 (Reuters) - The International Monetary Fund board agreed on a process on Thursday to select the next head of the institution, welcoming nominations from all of the fund's member nations and not just Europe, which under a long- standing custom has always filled the post.

"The nomination period will commence immediately and will close on Aug. 31, 2007," the board said in a statement, saying the successful candidate must have a record in economic policymaking and have managerial and diplomatic skills.

The board said it would consider and nominate the candidates in September after which it will decide on the successor to IMF Managing Director Rodrigo Rato, who resigned abruptly last month and will step down at the end of October.

The endorsement by the 24-member IMF board comes as some member countries, particularly in the developing world, question the 63-year tradition that a European national heads the fund and an American citizen leads the World Bank.

Europe, however, moved quickly this week to retain its hold on the IMF's top job by naming former French finance minister Dominique Strauss-Kahn as a candidate, but Britain said Europe could no longer say "the position is ours."

Opening up the process is key to broader reforms underway in the IMF that seek to recognize the rise of economic powers China and India and to give developing countries more say in the fund, as the fund expands its monitoring of the global economy.

REUTERS