Informal Board Meeting on the Selection of the Managing Director
Statement by Mr. Santos
March 14, 2000

Mr. Chairman,

I have the honor to inform you and the Board that in light of his high qualifications and broad experience, the European Union member states have unanimously agreed to present the candidacy of Mr. Horst Köhler, currently President of the European Bank for Reconstruction and Development, for the post of Managing Director of the IMF, to be filled following the resignation of Mr. Camdessus.

I should like to suggest that you ask Mr. Esdar to say a few words on the candidate.

I will circulate the written nomination paper later today.

Informal Board Meeting on the Selection of the Managing Director
Statement by Mr. Esdar, Executive Director, March 14, 2000

Mr. Chairman, dear colleagues:

The Government of Germany is grateful to the member states of the European Union for their unanimous expression of support in nominating Horst Köhler as their candidate for Managing Director of the International Monetary Fund.

Mr. Köhler is eminently qualified to lead the Fund at the dawn of a new century. The extraordinary and complex challenges facing this institution demand a strong and experienced leader with the strength of character to steer a steady yet flexible course. Horst Köhler's background meets this test.

As President of the European Bank for Reconstruction and Development; as President of the German Savings Banks Association; as Germany's Deputy Minister of Finance, Mr. Köhler has performed with distinction, drawing the praise of the international community for his policy orientation, his strategic outlook, and his vigorous commitment to dialogue and partnership as the basis for successful international cooperation.

His extensive education as an economist, which includes a Ph.D. in economics and political science from the University of Tübingen, provided the basis for a successful career at the Federal Ministry of Economics and at the Federal Ministry of Finance. Appointed head of the Ministry's Directorate-General on financial policy, he became the Finance Minister's most important advisor on economic and financial policy. As head of the Directorate-General for "Money and Credit", he handled international monetary policy issues as well as banking and insurance supervision and the Treasury's funding program.

In 1990 he was appointed Deputy Minister of Finance, playing a central role in the process of political unification of Germany. This experience would later give him a unique understanding of the transition process in representing Germany at international negotiations to establish the EBRD.

His responsibilities as Deputy Minister included supervising the Treuhandanstalt, the organization established to restructure and privatize East Germany's state-owned enterprises. He also engineered the Federal law on the promotion of the financial markets, paving the way for greater transparency, efficiency and competition in that sector. But most notable at this period in his career is his work in the realm of international financial and monetary policy. He served as G7 Deputy and "sherpa" in the preparation of the World Economic Summits in Houston (1990), London (1991), Munich (1992) and Tokyo (1993). In the summit process he strongly promoted the economic policy focus on the structural reform agenda, including tax, pension and labor-market reform. His wide knowledge and deep understanding of the complexities of reunification helped prepare the international community for the inclusion of Russia in the G7 process.

Mr. Köhler played a key part in the process of European unification, representing Germany on the European Monetary Committee. Mr. Köhler's leading role in the inter-governmental conference on the creation of the European Economic and Monetary Union helped lay the path to monetary union at Maastricht. He exercised this role with a clear vision for European and global political developments.

The German Federal Chancellor placed great confidence in Horst Köhler, appointing him as his personal representative to the politically sensitive financial negotiations on the withdrawal of Russia's troops from Germany.

As Deputy Minister, one of Mr. Köhler's duties was to formulate the German government's position on all issues of the operating policy of the IMF. He distinguished himself in this field and earned a great deal of recognition. Besides his duties in connection with the IMF, however, he also served as deputy Governor at the World Bank, and was intensely concerned with issues of development policy.

In August 1993, Mr. Köhler followed a call from the German Savings Banks Association to become its president. In this capacity he initiated a structural change in this financial group to improve its competitiveness. But he also understood this group as contributing to a political concept and process for adjusting to globalization, while at the same time safeguarding economic and social stability at the local level.

In September 1998, with the unanimous backing of its shareholders, Mr. Köhler became President of the EBRD in London. He took over the institution in the immediate aftermath of the financial crisis in Russia. He orchestrated a clean-up of the project pipeline and a successful review of the Bank's medium-term strategy and thus not only led the Bank again to profitability, but also strengthened it to better meet the transition challenges ahead. The success in shaping the difficult reorientation of the EBRD and guiding the Bank to its present, more robust position, demonstrates Mr. Köhler's strong managerial abilities and leadership.

During his EBRD Presidency, he strongly advocated closer cooperation among the multilateral development banks and the IMF, with two pilot initiatives for enhanced cooperation (in Romania and the Kyrgyz Republic) launched last year.

Mr. Köhler knows the international financial world from all points of view. He is equally familiar with macroeconomic policy, structural adjustment and investment financing. Both crisis prevention and crisis management are among his strong suits, as is his ability as a good communicator.

Horst Köhler

Personal   -   Born February 22, 1943 in Skierbieszów, Poland
  -   Married, two children
  -   Doctorate in economics and political science, Tübingen University
  -   Languages: German, English

September 1998
- present
President, European Bank for Reconstruction and Development (EBRD)
  -   Oversees project finance bank with EUR 20 billion in authorised capital, making EUR 2-3 billion in annual new loans and commitments to central and eastern Europe and the Commonwealth of Independent States.
  -   Undertook major review of Bank's strategy, resulting in greater focus on financial sector, small and medium-sized enterprises, and infrastructure, with shift of senior staff to the countries of operation.
  -   Presided over turnaround from loss in 1998 to profitability in 1999.

1993 - 1998   President, German Savings Bank Association
President, European Savings Bank Group
  -   Largest German banking group, including retail and wholesale banks, investment funds, and insurance companies.
  -   Initiated structural adjustment in the group, including successful merger of two major Frankfurt-based member institutions as part of strategy to improve group's competitiveness.

1990 - 1993 Germany's Deputy Minister of Finance
  -   Responsible for international financial and monetary relations, in particular Germany's position on IMF and G7 issues, and member of the Monetary Committee of the European Union.
  -   Personal representative ("sherpa") of the Federal Chancellor for the preparation of the Group of Seven summits in Houston, London, Munich and Tokyo.
  -   Led the negotiations on behalf of the German government for the Maastricht treaty on European Economic and Monetary Union.
  -   Represented Germany in the Paris Club.
  -   Closely involved in the process of German political unification.
  -   Member of the Supervisory Board of the Treuhand agency, which oversaw restructuring and privatisation of East German enterprises.
  -   Served as deputy governor at World Bank.

1976 - 1989 Professional career at the Federal Ministry of Economics and the Federal Ministry of Finance
  -   Director General for economic and financial policy. Oversaw major program of fiscal consolidation and tax reform.
  -   Director General for international financial relations, banking and insurance supervision and federal funding.

1969 - 1976 Scientific research assistant, Institute for Applied Economic Research, University of Tübingen


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