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Top of the World: Former IMF Chiefs

Ed Hunton|CNBC.com

Former Heads of the IMF

Dominique Strauss-Kahn's resignation following a sex scandal in which the former head of the International Monetary Fund (IMF) was accused of assaulting a maid in a New York hotel room triggered worldwide discussion about who will get the top position in the Washington-based organization.

Dominique Strauss-Kahn's resignation following a sex scandal in which the former head of the International Monetary Fund (IMF) was accused of assaulting a maid in a New York hotel room triggered worldwide discussion about who will get the top position in the Washington-based organization.

The race is then open between French Finance Minister Christine Lagarde and Governor of the Bank of Mexico Agustin Carstens, and the winner should be announced before June 30 by the board of directors of the IMF.

Click ahead to see the former heads of the organization.

Posted 27 June 2011

Camille Gutt, Belgium

Tenure: May 6, 1946 – May 5, 1951Choosing the head of a new institution is never easy. When the International Monetary Fund (IMF) was created, the big question of who would lead it came to the table. After the US candidate Harry D. White was kicked out of the race following espionage accusations, an outsider, the Belgian-born Camille Gutt, filled his space. Gutt, who was originally a journalist and a jurist, was not an economist, Francois Crombois, an associate professor in political sciences at
Photo: Marie Hansen / Time & Life Pictures / Getty Image

Tenure: May 6, 1946 – May 5, 1951

Choosing the head of a new institution is never easy. When the International Monetary Fund (IMF) was created, the big question of who would lead it came to the table. After the US candidate Harry D. White was kicked out of the race following espionage accusations, an outsider, the Belgian-born Camille Gutt, filled his space.

Gutt, who was originally a journalist and a jurist, was not an economist, Francois Crombois, an associate professor in political sciences at the American University in Bulgaria and author of "Camille Gutt and Postwar International Finance," told CNBC.

"Gutt was the anti-Strauss-Kahn… he had a very high sense of integrity and honesty, both in political and personal life," Crombois said, adding that Gutt's background is not that dissimilar to Christine Lagarde’s, "but with a businessman side of it."

This businessman image was not to help in the 1930s Europe, especially given Gutt's Jewish origin, but the Belgian managed to hold different ministerial functions during that period.

As finance minister he is credited with helping to save the Belgian franc both before and after the Second World War.

In March 1939, he took the leadership in the decision to transfer part of the Belgian gold reserve away from the Nazi threat, to London, the US and France.

Later, after the war, he conducted a monetary reform to fight inflation which "is now the example of what should be done after liberation," Crombois explained, "it set the example for France’s revaluation and creation of the New Franc in 1959."

Ivar Rooth, Sweden

Tenure: August 3, 1951 – October 3, 1956Since the creation of the fund in 1944, an unwritten rule confers its head to a European, while Americans would lead its sister agency, the World Bank. However, Ivar Rooth, a Swedish banker who led the Washington-based agency between 1951 and 1956, had previously held a high-ranking position at the World Bank. When the IMF chose him to hold the position of Managing Director, Rooth had been sent by the World Bank to Iran to work on the possibility of a mass
Photo: Risbank

Tenure: August 3, 1951 – October 3, 1956

Since the creation of the fund in 1944, an unwritten rule confers its head to a European, while Americans would lead its sister agency, the World Bank.

However, Ivar Rooth, a Swedish banker who led the Washington-based agency between 1951 and 1956, had previously held a high-ranking position at the World Bank.

When the IMF chose him to hold the position of Managing Director, Rooth had been sent by the World Bank to Iran to work on the possibility of a massive loan to help the country’s economy to develop.

During his mandate, Rooth set new goals for the IMF and freeing international trade became the institution’s main target. Rooth made clear during his introductory speech on September 11, 1951 that he would seek "removal or modification of exchange restrictions and other discriminatory practices."

Per Jacobsson, Sweden

Tenure: November 21, 1956 – May 5, 1963Even though Per Jacobsson is mostly remembered for leading the IMF through the period whan the fund granted $561.5 million to the UK after the Suez Canal fiasco, and $655 million to France when the country’s economy was suffering after the loss of the war in Indochina and the ongoing Algerian turmoil, the second Swedish economist to lead the fund also left a different mark. Under the pseudonym of Peter Oldfeld, Jocobsson worked with his friend Vernon Bartle
Photo: The Bank for International Settlements

Tenure: November 21, 1956 – May 5, 1963

Even though Per Jacobsson is mostly remembered for leading the IMF through the period whan the fund granted $561.5 million to the UK after the Suez Canal fiasco, and $655 million to France when the country’s economy was suffering after the loss of the war in Indochina and the ongoing Algerian turmoil, the second Swedish economist to lead the fund also left a different mark.

Under the pseudonym of Peter Oldfeld, Jocobsson worked with his friend Vernon Bartlett to publish "The Death of a Diplomat" in 1928, and a year later, "The Alchemy Murder." Both were crime fictions, quite far from Jacobssen’s financial legacy, and both were adapted into movies.

Pierre-Paul Schweitzer, France

Tenure: September 1, 1963 – August 31, 1973Pierre-Paul Schweitzer had a legacy to live up to. The nephew of both Nobel peace price laureate, Albert Schweitzer, and Boston Symphony Orchestra conductor, Charles Much reached the top position of the fund in 1963. He had previously held high positions in the French economic system, including as the director of the Treasury of France, and the vice-governor of the Bank of France, but he had also been a World War II resistance fighter, for which he was
Photo: Francis Miller / Time & Life Pictures / Getty Image

Tenure: September 1, 1963 – August 31, 1973

Pierre-Paul Schweitzer had a legacy to live up to. The nephew of both Nobel peace price laureate, Albert Schweitzer, and Boston Symphony Orchestra conductor, Charles Much reached the top position of the fund in 1963.

He had previously held high positions in the French economic system, including as the director of the Treasury of France, and the vice-governor of the Bank of France, but he had also been a World War II resistance fighter, for which he was awarded decorations, and a Buchenwald concentration camp survivor.

Even though Pierre-Paul Schweitzer’s birthplace, Strasbourg, was German when Schweitzer was born, he was the first of a long list of Frenchmen to lead the fund. He was also the first managing director of the IMF to stay in office beyond the end of his first mandate.

Johannes Witteveen, Netherlands

Tenure: September 1, 1973 – June 16, 1978The responsibilities that accompany the chair of a managing director of the IMF can be quite a heavy burden. Johannes Witteveen, the fifth IMF head, dealt with the stress through Sufism, an ideology also known as "the heart of Islam." "Sufism is about knowing who we are, understanding the human soul, based on the following Islamic principle: ‘If you know yourself, you’ll know your Lord,’" Philippe Moulinet, the author of "Le Soufisme Regarde l’Occident,"(
Photo: Netherlands Institute for Sound and Vision

Tenure: September 1, 1973 – June 16, 1978

The responsibilities that accompany the chair of a managing director of the IMF can be quite a heavy burden. Johannes Witteveen, the fifth IMF head, dealt with the stress through Sufism, an ideology also known as "the heart of Islam."

"Sufism is about knowing who we are, understanding the human soul, based on the following Islamic principle: ‘If you know yourself, you’ll know your Lord,’" Philippe Moulinet, the author of "Le Soufisme Regarde l’Occident,"(Sufism looks West) told CNBC. In Sufism, one will find "disinterestedness," he said, "So a Sufi won’t seek embezzlement or approval. The power of money has no weight so ethics is stronger."

The discipline may also be perfectly suited for the head of an organization whose role is to lend money to populations in need. "Sufism makes you care about people in difficulties," Moulinet said, "which in a way is not compatible with wild capitalism."

Mr Witteveen has himself written books about Sufism, which was brought to him by his parents during his childhood. "With such great responsibilities one could easily become very tense," Witteveen once said in an interview to Time, adding that meditation was a way, for him to turn "away from all that happened during the day".

Jacques de Larosière, France

Tenure: June 17, 1978 – January 15, 1987In 1982, the Mexican debt crisis broke out during Jacques de Larosiere’s mandate at the head of the IMF, following an increase in interest rates triggered by the boom in oil and commodities prices in the late 1970s. The IMF’s reaction helped to tackle the issue and avoid a default domino effect in non-oil producing countries. After his term, De Larosiere kept on working on how to improve the global financial system. In 2009, he presided over a group of eco
Photo: Georges Gobet / AFP / Getty Images

Tenure: June 17, 1978 – January 15, 1987

In 1982, the Mexican debt crisis broke out during Jacques de Larosiere’s mandate at the head of the IMF, following an increase in interest rates triggered by the boom in oil and commodities prices in the late 1970s. The IMF’s reaction helped to tackle the issue and avoid a default domino effect in non-oil producing countries.

After his term, De Larosiere kept on working on how to improve the global financial system. In 2009, he presided over a group of economists which published a proposition to draw a framework for better financial regulations.

Among the different proposals was the creation of a “European Systemic Risk Council" (ESRC), making national regulators collectively responsible for registering and supervising credit rating agencies or even stronger regulations of hedge funds, which were widely blamed for the 2008 crisis.

Michel Camdessus, France

Tenure: January 16, 1987 – February 14, 2000Michel Camdessus might have been the most criticized head of the International Monetary Fund, but he was also the only one to be re-elected twice to the office. During his mandate, the world was hit by a series of financial crises, which hit emerging economies harder than most. Whether it be in the second Mexican crisis (1994), the one in Thaïland (1997), in South-East Asia (1997-1998), in Russia (1998), or in Brazil (1999), Camdessus’ IMF’s reaction w
Georges Dekeerle / Getty Images

Tenure: January 16, 1987 – February 14, 2000

Michel Camdessus might have been the most criticized head of the International Monetary Fund, but he was also the only one to be re-elected twice to the office.

During his mandate, the world was hit by a series of financial crises, which hit emerging economies harder than most. Whether it be in the second Mexican crisis (1994), the one in Thaïland (1997), in South-East Asia (1997-1998), in Russia (1998), or in Brazil (1999), Camdessus’ IMF’s reaction was highly criticized as it was considered too ultra-liberal, too disconnected from reality and even sometimes too neo-colonialist, as the IMF imposed western-style economic reforms in exchange for financial help.

Camdessus resigned in 2000, two years before his mandate was due to end, became an advisor to Pope John-Paul II. The criticism did not end, as both Turkey and Argentina suffered crises after his departure.

Horst Köhler, Germany

Tenure: May 1, 2000 – March 4, 2004Born in 1943, from a Romanian family in Nazi-occupied Poland, Horst Köhler fled with his family to Leipzig, East Germany, and then West to Bade-Wurtemberg. When East and West Germany reunified in 1990 Köhler was made deputy finance minister of the country and contributed to negotiating the terms of the reunification and the Maastricht treaty two years later. In 2004, Köhler resigned from the IMF, four years into his mandate, to stage a successful run for German
Photo: Johannes Simon / Getty Images

Tenure: May 1, 2000 – March 4, 2004

Born in 1943, from a Romanian family in Nazi-occupied Poland, Horst Köhler fled with his family to Leipzig, East Germany, and then West to Bade-Wurtemberg. When East and West Germany reunified in 1990 Köhler was made deputy finance minister of the country and contributed to negotiating the terms of the reunification and the Maastricht treaty two years later.

In 2004, Köhler resigned from the IMF, four years into his mandate, to stage a successful run for Germany’s presidency, a mostly symbolic position.

He caused controversy in May 2010 with a public statement made upon returning from Afghanistan, where German troops had been deployed despite a lack of popular support for the mission.

“A country of our size, with its focus on exports and thus reliance on foreign trade,” he said, “must be aware that ... military deployments are necessary in an emergency to protect our interests - for example when it comes to trade routes, for example when it comes to preventing regional instabilities that could negatively influence our trade, jobs and incomes.” Köhler resigned nine days later, on May 31st, 2010.

Rodrigo de Rato, Spain

Tenure: June 7, 2004 – October 31, 2007Rodrigo de Rato was the third IMF managing director in a row to resign. After only three years in office following his appointment as Köhler’s replacement, the Spaniard decided to leave the IMF "for personal reasons." He went on working as a counsellor for Criteria-Caixacorp, Banco Santander – the largest European private bank – and Lazard. In 2009, de Rato announced he would give up these positions to join Caja Madrid, and become the Spanish savings bank’s
Photo: Alex Wong / Getty Images

Tenure: June 7, 2004 – October 31, 2007

Rodrigo de Rato was the third IMF managing director in a row to resign. After only three years in office following his appointment as Köhler’s replacement, the Spaniard decided to leave the IMF "for personal reasons."

He went on working as a counsellor for Criteria-Caixacorp, Banco Santander – the largest European private bank – and Lazard. In 2009, de Rato announced he would give up these positions to join Caja Madrid, and become the Spanish savings bank’s president.

Dominique Strauss-Kahn, France

Tenure: November 1, 2007 – May 18, 2011Before being tarnished by allegations of sexual assault, Dominique Strauss-Kahn’s contribution as the head of the IMF was widely praised as he led the organization’s partial reform, involving emerging markets in the institution's decision making for the first time. A socialist and college professor, DSK – as he is known in France, his home-country – joined the IMF in 2007 after the French president Nicolas Sarkozy lobbied for his candidacy, allegedly as a w
Photo: Spencer Platt / Getty Images

Tenure: November 1, 2007 – May 18, 2011

Before being tarnished by allegations of sexual assault, Dominique Strauss-Kahn’s contribution as the head of the IMF was widely praised as he led the organization’s partial reform, involving emerging markets in the institution's decision making for the first time.

A socialist and college professor, DSK – as he is known in France, his home-country – joined the IMF in 2007 after the French president Nicolas Sarkozy lobbied for his candidacy, allegedly as a way to get him out of the way for the 2012 presidential election. However, polls released before his prosecution in New York saw him ahead of the right-wing candidate, and political analysts were already calling the presidential race his, should he decide to give up his IMF position.

The Sofitel sex scandal put a stop to it and forced him to resign, leading to a race between his French compatriot Christine Lagarde and Mexican economist Agustin Carstens for the top IMF seat.

Whose will it be? The answer is expected on June 30, 2011 at the latest.