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CIAO DATE: 06/04
Go Back to Basics at the IMF
On The Issues
April 2004
Desmond Lachman
Abstract
The Europeans who will nominate a new managing director for the International Monetary Fund should view their task as an opportunity to return the Fund's focus to exchange-rate issues and assistance of countries in fiscal crisis.
Horst Koehler's hasty departure as the IMF's managing director has already started the horse-trading amongst the European nations to whom tradition has assigned the task of nominating a successor. It would be the greatest of pities if in that horse-trading the Europeans lost sight of the fact that perhaps never before has the IMF been in need of more basic reform. For the IMF now has practically nothing to say about the key global exchange-rate issues of the day. Moreover, in recent years, the IMF's bread and butter business of lending to crisis-stricken countries has run amok.
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