By Kelechi Deca
WHEN the International Monetary Fund (IMF) jettisoned a 68-year-old bylaw that prohibited the appointment of a candidate aged 65 or above as its Managing Director, it paved the way for 66-year-old Bulgarian environmental economist, Kristalina Georgieva, to head the multilateral lender. That singular accommodative action was indicative of Georgieva’s sterling qualities.
In taking that decision, the executive board of the Fund said that the amendment brings the Managing Director’s terms of appointment in line with those of members of the IMF executive board, which the managing director chairs, and those of the president of the World Bank, which is not constrained by an age limit. Georgieva’s ascendancy to the position of Managing Director of IMF is unique in many respects. First, she succeeded Christine Lagarde who was the first woman to head the global lender, a clear sign that the Brettonwoods institution is walking the talk on mainstreaming gender rights. Second, the position of the IMF managing director is traditionally reserved for Europeans, but there has been an overwhelming presence of the French on that list with five out of the 11 past Managing Directors being French.
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The choice of a Bulgarian was a clear break from the past where countries from Western Europe had dominated the position in the past seven decades. Georgieva, who served on the European Commission and had been the Chief Executive Officer of the World Bank since January 2017 was the clear choice of the European Union. She defeated former Dutch Finance Minister, Jeroen Dijsselbloem to clinch the position. Her time at both the European Commission and the World Bank Group marketed her as an insider in both organizations with in-depth knowledge of development challenges of emerging market countries, given the bumpy relationship the Fund has had with that group of countries.
Moreso, observers see her appointment as coming at the right time when environmental issues are on the front burner of economic policy making. Georgieva is bringing her vast knowledge of environmental policies into the development mix, having joined the World Bank as an environmental economist in 1993.
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Many in Washington D.C. also see her appointment as a welcome development, especially to assuage the yearnings of Brettonwoods’ insiders who have been angling for one of their own to head either of the institutions.
Georgieva is coming at a seeming less turbulent period in the global economy, unlike her predecessor who guided the IMF through the European sovereign debt crisis, which began about a month after she took office. Nonetheless, many think the storm may not be far off, especially with the off and on trade war rhetoric from the world’s two biggest economies, the recurrent Argentina debt crisis, and the rising nationalism that threatens the gains of multilateralism of the last seven decades. As a champion of multilateralism, Georgieva is expected to maintain Lagarde’s recent focus on tackling climate change, boosting female labour participation and reducing inequality. A longtime World Bank official who served as EU commissioner for aid and crisis response, Georgieva has more expertise in development than Lagarde but less familiarity with financial trouble in advanced economies.
She is taking office at a time Argentina’s debt crisis is hitting the roof and it is likely that the IMF will renegotiate or replace the existing controversial programme. She will also have to contend with the slowdown of the global economy which will put pressure on the IMF as the world’s lender of last resort to funnel support to more countries seeking support. Revered as one of the most influential women in global development, Georgieva’s achievements are eloquent and reassuring. From February to April 2019, she served as Interim President of the World Bank Group, following Jim Yong Kim’s resignation. Now, she sits atop the management of that development institution, its service to humanity. In 2010, Georgieva was named “European of the Year” and “Commissioner of the Year” by European Voice for her leadership of EU’s humanitarian response to crises.
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She holds a master’s degree in Political Economy and Sociology and a PhD in Economic Science from the University of National and World Economy in Sofia. Between 1977 and 1991, she was a professor at the same University.
Georgieva has more than 100 publications and is the author of the first microeconomics and co-author of the first macroeconomics textbooks in Bulgaria. She has lectured at universities around the world, including Harvard University, Moscow State University, the Massachusetts Institute of Technology, the London School of Economics, Tsinghua University, the University of the South Pacific and the Australian National University. In addition to her native Bulgarian, she is fluent in English and Russian and has a strong working knowledge of French.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.