IMF Nominations.

The nominations for the new Managing Director of the International Monetary Fund (IMF) are now closed and there are two candidates to replace Dominique Strauss-Kahn; Christine Lagarde of France and Augustin Carstens of Mexico.

Christine Lagarde: As the first female finance minister of a G8 nation Ms Lagarde is the clear front runner in the race already enjoying a significant public profile. The only problem is that she lacks any formal training or qualification in economics. Ms Lagarde qualified as a lawyer and went on the gain a masters degree in politics before rising to the Chair of the executive committee of the internationally respected Baker & McKenzie law firm where she specialised in European Union law. Then in 2005 she took up the role of French trade minister on behalf of the centre right Union pour un Mouvement Populaire (UMP) party which is now led by Nicholas Sarkozy. In 2007 Ms Lagarde was appointed as the agriculture minister before quickly moving on to become the finance minister where, like everyone else, her record is unproven due to the 2008 - 2012 economic crisis. So while Ms Lagarde has undoubtedly won the respect of many of her peers she is likely to find it difficult to move from the political role of finance minister to the more purely technocratic role of IMF head. She is also currently facing some corruption charges that a French court still has to rule on.

Augustin Carstens: By contrast Augustin Carstens is a heavyweight in all senses of the word. He earned a bachelors degree in economics from the Instituto Technologico Autonomo de Mexico (ITAM) before going on to gain a masters degree and a PHD in the subject from the University of Chicago where he met his American wife. He returned to Mexico in 1991 to become the Treasurer of the national bank (Banco Nacional de Mexico) at the tender age of 33. One of Dr Carstens first tasks in the job was to deal with the aftermath of the Latin American debt crisis of the 1980's. Rather like the problems the global economy faces now this was a regional debt bubble that burst leading to a deep and prolonged recession. Due to his success in meeting this challenge Dr Carstens went on to become the head of economic research at the bank in 1993. Here he helped redesign the Mexican economy following the collapse of the national currency (peso) in the mid-1990's. In 2003 he took up the post of deputy managing director of the IMF and held the post until 2006 when he returned to Mexico to become the countries finance minister in 2009 under the Presidency of Felipe Caledron. One of Dr Carstens first decisions in that post was to surprise everyone by hedging Mexico's oil revenues against price falls in a move that made the country US$9bn. So on paper Dr Carstens is by far the most qualified and experienced candidate. Also because he is Mexican if he is appointed he will break the rather outdated tradition of the IMF always being headed by a European. This will please the developing and newly developed nations by making the IMF a less Euro-centric organisation.

In preparation for the vote Britain has almost doubled it's contribution to the IMF from US$16.8bn to US$31.5bn. The way the IMF works is the more money a member nation contributes the more say they get in how the organisation is run. So Britain must really want Christine Lagarde to be the next head of the IMF. Presumably so she can continue where DSK left off in messing up the Eurozone bailouts.