MANILA, Philippines - The process for choosing the new managing director of the International Monetary Fund (IMF) should take into consideration the increasingly changing global economic landscape, the country’s Finance chief said yesterday.
“The selection process for the new managing director of the IMF should be global in substance, not just in form,” Finance Secretary Cesar Purisima said.
He also believes that the process should be transparent and that all stakeholders must be included.
“The selection process should be characterized by transparency and inclusiveness. Gone are the days when the future of the world economy is left in the hands of only a few countries,” he said.
Furthermore, Purisima said that qualified candidates from Asia and from Latin America and other emerging markets must be considered.
“In fact with the problems in Europe, it might be wise to get someone who is totally objective from the situation,” he noted.
The Finance chief believes that Singapore Finance Minister Tharman Shanmugaratnam, who is also currently the chairman of the International Monetary and Finance Committee, the IMF advisory committee, is qualified.
“I think Minister Tharman is certainly well qualified. As you all know in the late 90’s, Asia underwent in its own debt contagion and I think that experience will come in handy in helping our European friends deal with their own debt crisis,” Purisima said in a separate interview with Bloomberg TV.
The IMF selection team should also look at leaders in China and in Latin America, he noted.
At the same time, Purisima conceded that having an Asian IMF chief would be a difficult thing to do.
He cited the IMF weighted voting system that gives more votes to developed nations. Among the top 30 economies that enjoy the majority of IMF voting rights, only seven were from Asia.
They are Japan (with 6.3 percent of voting rights); China (3.8 percent); Saudi Arabia (2.8 percent); India (2.4 percent); Korea (1.4 percent); Indonesia (0.9 percent); and Malaysia (0.7 percent).
On the other hand, United States has most of the voting rights at 16.8 percent.
The Philippines has only 0.4 percent voting rights.
“That is why countries should have an open discussion on this. Developed nations should also have open minds while emerging markets should get their act together to come up with a lone Asian candidate that will lead the international organization,” Purisima said.
Purisima expressed hopes that someone from Asia would be appointed as the next IMF chief.
Former IMF managing director Dominique Strauss-Khan, who led the IMF since 2007, resigned last week at the height of charges of sexual assault following his alleged abuse of an employee in a posh New York hotel.