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Why Tharman should run for top IMF post

The Straits Times | Meghnad Desai | Friday, Apr 25, 2014

Mr Tharman Shanmugaratnam, Singapore Finance Minister.

Christine Lagarde is more than halfway through her tenure as the managing director of the International Monetary Fund (IMF). She is the 11th consecutive European in the job. There is no shortage of talent as to who will succeed her in July 2016. This time, ample notice is required to prepare an open and transparent selection process. There must be no European monopoly.

I would like Mr Tharman Shanmugaratnam, the Singapore Finance Minister, to be a candidate. He is thoughtful, technically competent and well respected - and he would hit the ground running.

The IMF needs a managing director with equal doses of technocratic and political skills.

When Mr Dominique Strauss-Kahn, the overly high-flying previous incumbent, departed in 2011 because of extra-curricular activities, a feeble attempt was made to open up the appointment to a global contest, but the outcome was a foregone conclusion. A Frenchwoman followed a Frenchman. A French politician with presidential ambitions (sadly thwarted) was followed by another French politician with similar ambitions (always denied, of course).

For 38 of the 68 years in which the IMF has had a managing director, a French person has been at the helm.

I love the French. And I am all for women in top positions. But sometimes you can go too far.

In the previous round, the London-based Official Monetary and Financial Institutes Forum (OMFIF) backed Dr Zeti Akhtar Aziz, the highly accomplished governor of Bank Negara Malaysia, as a candidate. But she showed no inclination to join the contest.

Mr Tharman is an IMF insider. He has been the chairman of the International Monetary and Financial Committee since 2011. Its first chairman was Mr Gordon Brown, the former British chancellor of the exchequer and prime minister. Mr Tharman is Singapore's deputy prime minister and a previous chief executive of the Monetary Authority of Singapore (before he entered politics). He's a member of the prestigious Group of Thirty. You cannot get a better CV than that for the job.

In the past, when asked about the possibility that he might go for the position, Mr Tharman has shrugged his shoulders or murmured something self-deprecating. But if the possibility came into view, the Singapore Government would no doubt take it very seriously.

The IMF has just had its spring meeting in Washington. The world economy is in better shape than when Ms Lagarde took over. Losing Mr Strauss-Kahn was a shock. But the IMF is now on a more even keel. Its analysis of the world's experiments with austerity has been criticised, as has been its forecasting record. But that is not new.

The IMF has often got its macroeconomics wrong. Yet it faces challenges, as does the global economy. The US Congress, in its usual erratic manner, is holding up long overdue reforms, including quota rebalancing agreed by the rest of the world. The refusal to vote funds for reforms is entirely due to quarrels between President Barack Obama and Congress. Any movement is unlikely before November's mid-term elections.

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