Lipsky: Christine Lagarde 'excellent choice' for IMF

Media captionJohn Lipsky says the IMF will deal with the leadership issue "expeditiously"

The acting managing director of the IMF, John Lipsky, has said Christine Lagarde, the French finance minister, would be "an excellent choice" to head the organisation.

Mr Lipsky has been temporarily in charge of the International Monetary Fund since Dominique Strauss-Kahn was arrested on suspicion of rape.

Christine Lagarde has also been praised by both Italy and Sweden.

Singapore's finance minister also appears to be gaining support.

Tharman Shanmugaratnam has been backed as a possible choice by the Philippine finance minister and his Thai counterpart.

Complex vote

In order to become managing director of the IMF, individuals must be proposed by one of its 187 member countries.

Developing nations are keen that the next IMF chief should come from outside of Europe.

Other potential candidates from developing countries could include South Africa's Finance Minister Trevor Manuel and Turkey's former minister of economic affairs, Kemal Dervis.

However, since the body's formation in 1944, a European has filled the post and European officials are eager for the next leader to be one of their own.

Angela Merkel, the German chancellor, has already said that the post should go to a European.

Europe and the US together still control almost 50% of the votes, although the voting system is in the process of being changed to reflect the increasing power of the emerging markets.

The US has not yet indicated who it might favour.

"We haven't taken a position on any candidate," said Lael Brainard, US Treasury undersecretary for international affairs.

Mr Lipsky, who is due to step down from the Fund at the end of August, said the field was wide open: "I'm sure we'll hear many names. I'm encouraged, I've heard mention many very talented professionals."

But Christine Lagarde has been tipped as the current favourite, a situation that Mr Lipsky appeared to acknowledge in an interview with the BBC's economics editor Stephanie Flanders.

"I have the very highest regard for Ms Lagarde and I'm sure like many other candidates she would be an excellent choice," he said.

Coming battle

The IMF is a crucial part of the world financial system, along with the World Bank.

It represents the interests of its 187 member countries and has played a central role in the eurozone crisis, lending billions of dollars to help bail-out Greece, Ireland and Portugal.

Mr Lipsky would not be drawn on the battle that is emerging between European and emerging economies over who should get the job.

"This is an institution that works best in a collaborative, cooperative way. Most decisions are taken by consensus at the level of the executive board.

"So I'd expect, in the end, there will be general agreement around a talented, effective new managing director."

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