China backs emerging nations after IMF head resigns

19th May 2011, Comments 0 comments

China's central bank chief Thursday pushed for emerging countries to be included in the top leadership of the International Monetary Fund, after the resignation of embattled boss Dominique Strauss-Kahn.

"The make-up of top management should better reflect changes in the global economic structure and better represent emerging markets," Zhou Xiaochuan said in response to the resignation of Strauss-Kahn, who faces sexual assault charges in New York.

He said G20 nations had "already decided that IMF leaders and high-level management must be elected through an open, transparent and meritorious process."

Strauss-Kahn, a leading French politician, is in jail awaiting a grand jury decision on whether to indict him on charges linked to the alleged sexual assault and attempted rape of a chambermaid at a Manhattan hotel.

The 62-year-old resigned earlier Thursday. He has denied all seven counts of alleged sexual assault and attempted rape, as well as unlawful imprisonment.

The IMF has long been dominated by Western powers and faced growing calls to adapt to a changing global reality.

G20 leaders agreed last November to reform the Fund's 24-member board of governors, in a move designed to give emerging economies such as China a bigger say.

Europe agreed to give up two seats, and Brazil, Russia, India and China were to be among the top 10 IMF shareholders, with China moving up to become the third-largest shareholder from sixth place.

But those changes have not yet been implemented.

The official People's Daily -- China's Communist Party mouthpiece -- said Thursday the new IMF boss should be Chinese.

"One of the key jobs of the IMF is to monitor trade and provide capital assistance, which the rising China is good at,' it said in an online comment piece.

It pointed to several Chinese who had taken pole positions in global finance, including Zhu Min, a former deputy governor of China's central bank and a special advisor to Strauss-Kahn.

Chinese media has speculated that Zhu could be a candidate to succeed his former boss.

"It will be great sign of respect for a rising China and a symbolic step of optimizing the international financial order if the 24 executive directors who hold shares of the IMF can see this clearly and elect a Chinese president of the IMF," the People's Daily said.

The scandal involving Strauss-Kahn comes at a critical time for the IMF, amid delicate negotiations to help overcome the eurozone debt crisis.

Acknowledging the challenges facing the body, Zhou said a "strong IMF" was currently required.

© 2011 AFP

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