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IMF candidate Carstens, a global finance insider

13 june 2011, 19:25
0
Mexican central bank chief and IMF candidate Agustin Carstens. ©AFP
Mexican central bank chief and IMF candidate Agustin Carstens. ©AFP
The imposing intellectual and physical figure of Agustin Carstens has been a presence in the halls of global economic and financial institutions for decades -- and few doubt his qualifications to run the International Monetary Fund, AFP reports.

The Mexico central bank chief has already served three years as an IMF deputy managing director.

He was also a rising Mxican technocrat in the 1990s when the country was on the receiving end of an IMF-US rescue, one of the first to expose the dangers to developing countries of wild swings in global capital and foreign exchange markets.

That gives him an in-depth understanding of what the global last-chance lender to governments-in-need does and what it needs, say his backers.

But both his Mexican roots and his background in orthodox economics have made it harder for him to pull together the coalition necessary to challenge his rival to be IMF managing director, France's Christine Lagarde, who has the force of all of Europe behind her.

Carstens, 53, is one of a generation of savvy US-trained emerging economy economists who with strong links in capitals around the world.

He earned masters and doctorate degrees in economics at the University of Chicago, which has led to leftists labelling him as dogmatically bound to US-style free market principles.

He married an American colleague at Chicago, economist Catherine Mansell (who now writes novels as "C.M. Mayo"), and joined Mexico's central bank through the turbulent years of the 1980s and 1990s.

In 1999 he joined the IMF board as a director representing a number of Latin American countries for two years.

In 2003, he was named the IMF's second deputy managing director, leaving three years later to join the government of newly elected Mexican President Felipe Calderon as finance minister and then central bank head.

Carstens has pitched himself as someone to break the European's 65 year lock-hold on the IMF managing director's job.

A non-European in the job "is something that emerging countries have advocated and which we have to continue to work for," he told AFP in an interview.

Europe again wants one of their own to better help steer through the crises in Ireland, Portugal and especially Greece.

But, Carstens argues, since European IMF chiefs have presided over rescues in Latin America, "why shouldn't a Latin American be put in charge of helping resolve the economic problems of Europe?"

"For the moment, they have not managed to get to a situation where they have full credibility," he added.

Carstens "has been in the game a lot longer" than Lagarde, said Fred Bergsten of the Peterson Institute for International Economics in Washington.

"By the nature of his career, Governor Carstens has had more widespread and more lasting experience dealing with the range of issues that the IMF handles."

The Peterson Institute's Michael Mussa, who supervised Carstens' Chicago thesis, credits him with getting the IMF to broaden its role during the 2008-2009 financial crisis to help countries not in immediate difficulty, by creating its precautionary and flexible credit lines.

A Washington academic who knows him well said Carstens is perhaps not as much a politician as Lagarde or the recently resigned French IMF chief, Dominique Strauss-Kahn -- and the IMF chief needs to be a politician.

Carstens still runs into doubts in the developing countries he seeks to back him, in part because of his US in Chicago economics links.

But Raul Felix of the Centre for Research and Economic Education in Mexico, calls him "a pragmatist, not an ideologue characteristic of Chicago."

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