If the World Bank’s leadership is appointed by the United States, the IMF’s has be from Western Europe. Today, this non-written rule has become questionable since emerging countries have grown in terms of ownership and funding to the IMF.
Emerging nations now weigh significantly in the global arena, as did their role during the recent financial crisis. The nomination of the new IMF Director from a non-European country could become a reality, but still presents a few obstacles. Beijing has not officially requested a Chinese candidate to lead the IMF, but important chinese names have recently emerged. Zhu Min, a brilliant professor with a prestigious pedigree (ironically nominated as IMF counselor by Strauss-Kahn), and Zhou Xiaochuan, the Governor of the People’s Bank of China, has both been both rumored. The ultimate result depends highly on the speed of the decision-making process, as well as China’s negotiating skills. If the IMF’s new director were, indeed, to be Chinese, financial aid (even to Europe), credit policies to emerging countries, and a revaluation of the dollar dependency would be prioritized in the IMF agenda. Furthermore, if China would insist on nominating a national candidate, it would be sending a clear message of opening quickly the country’s capital market and of revaluating the RMB.
The USA and Europe would however not allow this to happen unless China commit to firm deadlines. This process could take time and China would not be willing to rush thru it. And time is precious, because the IMF and the world need a new Director General soon. A temporary Director could, at least, facilitate this transition until the end of 2012, when China could be ready for it, but no important European personality would accept a partial mandate. The next Director is probably going to be European again, but this could be the last round for Europe.