May 19, 2011IMF's Lipsky: Global recovery strengthening, fragile
The global economic recovery is accelerating but remains vulnerable to setbacks, IMF acting Managing Director John Lipsky said on Thursday, as he urged continued international support for shaky economies in Europe.
"The global recovery is gaining strength. But it remains fragile and uneven, and beset by uncertainties," he said a meeting of the Bretton Woods group, a private sector advisory group to the International Monetary Fund and World Bank.
Lipsky expressed chagrin at having to deliver remarks in lieu of the disgraced Dominique Strauss-Kahn, who resigned as IMF managing director overnight as he faces sexual assault charges in New York.
"I deeply regret the circumstances that have made it necessary for me to substitute for Dominique Strauss-Kahn," Lipsky said in remarks prepared for delivery to the Bretton Woods annual meeting.
Lipsky said European nations that are in critical economic condition as a result of sovereign debt crises deserve international support.
"There are compelling reasons for their European neighbors and the global community -- through the IMF -- to support these countries' reform efforts," he said.
"The only viable option for Europe today is a solution that is comprehensive and consistent -- and that is also cooperative and shared," he added.
He also said emerging market countries concerned about stemming a potentially volatile surge of capital into their economies might be justified on occasion in erecting capital controls.
Merit to be key in picking new IMF chief: Lipsky
Selection of a new leader of the International Monetary Fund should be made on the basis of merit, and it would not be unusual if it takes some time, acting Managing Director John Lipsky said Thursday.
"There's been agreement among our membership that the process of selection of the managing director should be open, transparent and merit-based," he said after addressing the Peterson Institute.
"Hopefully, open means open. Hopefully, open doesn't mean open to some," he said when asked about the process of picking a successor to Dominique Strauss-Kahn, who resigned as he faces charges in New York of sexual assault and attempting to rape a hotel maid.
Lipsky, who became acting managing director after Strauss-Kahn's arrest last Saturday, said later that French Finance Minister Christine Lagarde -- seen by many as a front runner -- was one of many well-qualified candidates.
"Many names have been mentioned in the press," he noted. "I'm happy to say many of them -- a long list of them -- seem extremely talented and well-qualified individuals."
Asked to comment specifically about Lagarde, Lipsky responded: "Of course, she's a very, very talented and capable leader. She's one of many names that have been mentioned."
Lipsky again said that the IMF was fully able to carry out its duties.
"To think that the institution was one man, however talented he might be or talented she might be, ... is an illusion," he said.
There have been calls from some capitals for the IMF membership to move quickly to pick a new chief in order to protect the stability of the global lender when it is dealing with critical issues including a debt crisis in Europe.
Lipsky noted that at times in the past when a new managing director was being selected, there had been "a hiatus" until the new chief was on the job.
"In the past it's been a matter of a couple of months because there's a selection process and then whomever is selected may not be available to appear immediately." he said. "I expect a process that is very straightforward and normal," he added.
http://www.reuters.com/article/2011/05/19/us-strausskahn-imf-selection-idUSTRE74I8E720110519
