IMF To Work Out Details For Chief's Selection Process

Now that Dominique Strauss-Kahn has resigned as head of the International Monetary Fund, competition for the top job is heating up. One issue is whether the managing director's office will once again be occupied by a European. That's been the case since the IMF was founded, a fact that has rankled emerging market nations like China, South Korea and Brazil.

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RENEE MONTAGNE, host:

This is MORNING EDITION from NPR News. I'm Renee Montagne.

STEVE INSKEEP, host:

And I'm Steve Inskeep.

Dominique Strauss-Kahn spent another night in jail on Riker's island last night in New York City. But as early as today the former head of the International Monetary Fund could leave. Yesterday, a New York judge set bail at $1 million cash and a $5 million insurance bond. Defense attorney William Taylor expects his client to be released on bail and confined to a New York apartment.

Mr. WILLIAM TAYLOR (Attorney): It's a great relief to the family to be able to have him with them. We look forward to continuing the defense of this case. We'll be back in court on June the 6th.

INSKEEP: At the same time, in Washington, the search has begun for a new IMF managing director. NPR's John Ydstie reports.

JOHN YDSTIE: After Dominique Strauss-Kahn resigned on Wednesday, John Lipsky, the number two man at the fund was named acting managing director by the IMF's executive board. One of Lipsky's first public acts was to take Strauss-Kahn's place delivering a lecture on the global economy last night in Washington.

(Soundbite of applause)

Lipsky said he deeply regretted the circumstances that had brought him to the podium. But he said the IMF would continue to be effective because of its competent and dedicated staff.

Mr. JOHN LIPSKY (Managing director, IMF): I am completely confident that the institution will be able to fulfill all its obligations, responsibilities and roles, fully, in such time as transpires until a new managing director is named.

YDSTIE: The IMF's executive board meets today to work out the details of the selection process. One issue is whether the managing director's office will, once again, be occupied by a European. That's been the case since the IMF was founded, a fact that has rankled emerging market nations like China, South Korea and Brazil.

The IMF's membership has recently agreed that the office should not be the sole domain of one region. Lipsky said, last night, that means a selection process that is open, transparent and merit based.

Mr. LIPSKY: Hopefully, that open means open. Hopefully, open doesn't mean open to some.

YDSTIE: But, European leaders, like Angela Merkel of Germany, have argued that it makes sense to appoint another European to head the global lender and financial watchdog, because of Europe's ongoing debt crisis.

The names of a number of candidates from emerging market countries have been floated in recent days, but the immediate front-runner appears to be French Finance Minister, Christine Legarde.

Speaking to reporters after his speech, Lipsky called Lagarde a very talented and capable leader. But, he said, what's encouraging is that so many of the potential candidates are high quality individuals with a proven track record. Lipsky indicated it will likely be months before a new permanent managing director is in place.

John Ydstie, NPR News, Washington.

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