September 20, 2006

Should we really give IMF management carte-blanche?

There is no doubt that the International Monetary Fund needs to evolve but that “The fund’s ancien régime will have to give up its privileges” in order for this to happen as Martin Wolf says (September 20), is not a foregone conclusion. Reducing the European representations, allowing the managing director to be from any country and giving more independence to management which are the three things that Wolf consider needed seems a bit like putting some order in your desk while you are thinking about what to do.

Wolf mentions that the IMF has the potential to play a valuable part in managing the world’s transition to an integrated global financial system and tough it sounds very right it would be good if he shared with us some concrete examples of what this would entail so that we can better share into his act of faith. As an outsider that has very respectfully questioned many of the Fund’s actions over the last decade, before giving what in Wolf’s French amounts to a carte-blanche to management, the least I would expect from them is a detailed plan of action which of course should also include the terms on which they themselves will be held accountable to stop them turning into even a less legitimate new ancien régime.