IMF MDs who resigned

Horst Köhler

The last three managing directors of International Monetary Fund (IMF) resigned from office before the expiration of their respective tenure. Sulaimon Olanrewaju examines the circumstances that resulted in each resignation.

None of the last three managing directors of the International Monetary Fund (IMF) served out his term. They all resigned, albeit for different reasons.

The gale of resignation by the chief executives of the Bretton Wood institution started with Horst Köhler, who assumed office as the managing director on May 1, 2000, sequel to his unanimous selection by the executive board of the IMF on March 23, 2000. While superintending over the IMF, Köhler concentrated on the promotion of financial stability, sustainable growth and poverty reduction in member countries.


Köhler’s position was premised on his belief that poverty was a threat to global security and welfare. According to him, IMF’s mission could be summarised as helping member countries to develop their human potential and productive resources, thereby building the foundations for sustainable economic growth. He, therefore, ensured that IMF under him partnered with member countries to engineer growth.

However, Köhler, who prior to taking up the IMF top job had been president of the European Bank for Reconstruction and Development, president of the German Savings Bank Association as well as Germany’s Deputy Minister of Finance, resigned as IMF managing director on March 4, 2004 one year before the expiration of his first term, following his nomination for the position of president of the Federal Republic of Germany. He eventually was elected president of Germany and was inaugurated on July 1, 2004 for a five-year term.


Dominique Strauss-Kahn

After an interregnum filled by Anne Osborn Krueger as acting managing director, Rodrigo de Rato from Spain was appointed a substantive managing director of the organisation on June 7, 2004. The executive board of the institution had earlier on May 4, 2004 appointed him to serve as managing director and chairman of the executive board.

Prior to his assumption of office as the IMF boss, Mr de Rato had served as Spain’s Vice- President for Economic Affairs and Minister of Economy. He was also a member of the boards of governors of the IMF, the World Bank, the Inter-American Development Bank, the European Investment Bank, and the European Bank for Reconstruction and Development.

As IMF managing director, de Rato concentrated on ensuring a cooperation between emerging economies and established ones. He tried to engineer as much development as possible in third world countries while helping developed economies to stabilise.

In a statement made in 2006 to reiterate his position on the essentiality of cooperation among countries of the world, the former IMF boss said, “I have proposed that the Fund complement its existing arrangements for consultations with individual countries with multilateral consultations, which would allow the Fund to take up issues comprehensively and collectively with systemically important members and, where relevant, with entities formed by groups of members, such as the European Union and the Gulf Cooperation Council. This is not a modest proposal. Multilateral consultations would be something new for the IMF and for our member countries, and they would be an important vehicle for analysis and consensus building. They would enable the Fund and members to propose action to address spillovers and linkages that affect individual members and the global financial system. And they would have added force if, as I propose, the analysis that emerges from them is discussed by both the IMF’s executive board and the IMFC.”

de Rato, however, announced his resignation after the IMF annual meetings in 2007 citing personal reasons. He later stepped down on October 31, 2007 before the expiration of his tenure.

Dominique Strauss-Kahn was nominated to replace de Rato and he took over the running of the organisation on November 1, 2007. Before taking up the Bretton Wood institution top job, Strauss-Kahn had served as Deputy Commissioner of the Economic Planning Agency in France. In 1986, he was elected Deputy Member of Parliament to the National Assembly, where he chaired the Finance Commission from 1988 to 1991 before his appointment as Minister of Industry and International Trade, during which time he participated in the Uruguay round of trade negotiations. He also served as France’s Minister of Economy, Finance and Industry from June 1997 to November 1999. In this capacity, he managed the launch of the Euro.

He also represented his country on the board of governors of a number of international financial institutions, including the IMF.


Rodrigo de Rato

His tenure as IMF MD witnessed the European debt crisis and he seized the opportunity to reposition the organisation as an investment bank of multilateral institutions. He was viewed by many people as having handled the crisis so well that a leading USA economist, Eswar Prasad, said that should Strauss-Kahn be forced to step down, the IMF “will find it hard to find as effective and skilful an advocate for keeping the institution central to the global monetary system.”

However, Strauss-Kahn had to resign his appointment as IMF MD on May 18 following his indictment in an alleged sexual assault on a maid at Sofitel Hotel in New York on Saturday, May 14. He was arrested after boarding a flight to France. He was said to have been on his way to Europe to discuss the worsening European debt crisis. He had been scheduled to meet the German chancellor, Angela Merkel, the following Sunday and European financial ministers on Monday and Tuesday. He was to have discussed how best to tackle Greece’s worsening debt crisis and finalise Portugal’s .78 billion bailout package.

Sulaimon Olanrewaju Wednesday, 25 May 2011


Source : tribune.com.ng