Informal Board Meeting on Selection of the Managing Director
Statement By Mr. Morais, Executive Director, 22nd February, 2000

Mr. Chairman, fellow Directors

It is common cause that we have been waiting for some time now for movement on the issue of a suitable successor to our highly regarded former Managing Director. Indeed Mr. Camdessus indicated his intention to step down two years ahead of the completion of his term, on November 9, 1999. When he made his announcement, he had also indicated that he wanted our Board, which seeks to operate on a collegiate basis on matters as crucial as the selection of a Managing Director, to make its best endeavours to find a suitable replacement and to discharge Mr. Camdessus from his duties before the middle of February 2000.

Chairman, the former Managing Director made his request 115 days ago. His distinguished term came to an end over a week ago and we have now entered a period of uncertainty and instability which we could all well do without. Thus far, no candidate has been put forward to succeed him, testimony perhaps to the enormity of the challenge which his successor will face.

If we imagine for a moment that the former Managing Director's announcement in November last year caused a pebble high up on the mountain to be dislodged, we could ask ourselves, what has been its journey since? Indeed it has been an eventful journey. As it rolled down the mountain, it would have recorded that we have had many meetings of the Board to discuss this issue, under the Chairmanship of our Dean, including our meetings of November 23, and December 7 and 14, last year, as well as several further meetings this year. It would have recorded that in early December, the group of 11 Executive Directors representing developing countries put forward a set of three principles which should govern the manner in which any Managing Director of our institution should be chosen, centering on the principles of full participation, transparency of process and consideration of a plurality of candidates irrespective of nationality, sex, race or any other influence which could result in us selecting any but the best candidate for the job. As it continued rolling downward, gathering pace, it would have recorded substantial developments and substantial progress in the work agenda of our institution - discussion of the first group of Financial Stability Assessment Papers and Financial System Stability Assessment Fund's, which will acquire an important role in the future as part of the Fund's growing complement of surveillance instruments; the successful reviews of several countries which were the subject of financial and currency crisis just two years ago; the implementation two weeks ago of a program involving the use of fund resources in one member which was at the very centre of the crisis two years ago - surely a sign that that period of crisis is now past, if ever there was such a sign; it would have witnessed the coming into being of the Poverty Reduction and Growth Facility of the Fund, which will affect the well-being and livelihoods of nearly a half of our membership by country and where more than a half of the world's population lives. While continuing to roll, it would have seen out the last century and millenium and ushered in a new one; it would have noted a wide array of further developments in the Fund's work on new financial architecture. It will have noted the first in what I hope will be an escalating array of Enhanced HIPC countries coming to the Board for finalisation of debt relief. It will have seen the events of Seattle and recognised that the world cannot afford that our institution take a path of indecision, that the world will not forgive a period of uncertainty at the helm of the largest and most significant multilateral institutions. I believe that it is not prepared, after a reasonable period for consultation, to wait for an open-ended, unclear succession process at the helm of our institution, which stands as a giant among them, a crucial guardian of international stability. This pebble, as it rolled along, will have heard us all say to ourselves and to the outside world that we will not betray the countless numbers of the world's population that look to the Fund for responsible leadership. Most recently, it will have recorded, with some regret, that even after the departure of Mr. Camdessus and 115 days after his notice of intention to step down, no candidate has been nominated to succeed him. And it will have noted that thus far, the three principles presented by the G-11 Chairs, which I believe has the universal support of all colleagues, have thus far not been given substance to.

After its long and winding journey, the pebble which started rolling 115 days ago, has slowed. It has already passed the milestone that it thought would be its finishing post, early last week, with the departure of the former Managing Director. The pebble now hangs silently at its angle of repose, with no signal to alert ourselves or the world outside of further progress.

I propose now, Chairman, to table a proposal which can see this pebble continue smoothly on its journey, to pass the finishing post and to give effect to the principles of transparency, openness and full participation espoused by the developing countries and I am convinced by the entire Board. And I do so after wide and thorough consultation among my own 20 constituent members, who without hesitation support me in my proposal. I put forward for the consideration of my colleagues the nomination of Mr. Stanley Fischer, our highly regarded First Deputy Managing Director, to succeed Mr. Michel Camdessus as Managing Director of the International Monetary Fund, effective upon securing the vote of the Executive Board and for a full five year term.

I believe that Mr. Fischer satisfies every possible quality that we would imagine to be desirable for the Managing Director of our institution. Through his term, recently renewed, as First Deputy Managing Director, he has shown himself to be an accomplished expert in the core areas of the Fund's mandate, leading the international dialogue on every aspect of the emerging new financial architecture. He has proved adept at promoting our institution and at protecting its integrity, while at the same time, succeeding in balancing the interests of the institution he serves, with those of the widest possible spectrum of the membership which own it. He has demonstrated a profound sensitivity to the wide divergences in the economic and social status of differing members of our common institution. Through his consensus-building style, he has built universal support in each of the endeavours he has taken on. His credentials have been tested in the very heat of crisis, where his influence has been calming, realistic and business-like. He has the ability to forge consensus from seemingly irretrievably polarised positions. He has held high the values of universalism which have carried our institution through all of its own trials and tribulations, a characteristic which will be fundamental as we find our way in the new century. He has an ease of interaction which must be the envy of anyone who has reached, or will soon reach, the pinnacle of her or his career. He carries a political weight commensurate with the status of a Managing Director of the IMF. At the same time, he has shown himself to be independent minded, fearless in speaking his mind even if this conflicts with the views of the political authorities among our membership, largest, large, medium, small and smallest.

These of course are my own observations of Mr. Fischers' outstanding performance on the job and specifically his performance as it addresses the full membership. I have also observations about his rapport with African members which I would also like to share with you. African countries, as you know, Chairman, comprise more than one quarter of the IMF's membership on a country basis. More than one in every four members of the Fund is a member from Africa. And far more than one in four member countries in which the Fund has a programme, hails from Africa. The epicentre of the Fund's work on post-conflict assistance is in Africa. The overwhelming majority of the Heavily Indebted Poor Country Debt initiative cases are located in Africa. And African countries already are and will continue to be, the largest users of the Fund's concessional resources. It goes without saying, that a Managing Director that does not serve the interests of the African members of the Fund, will not serve the interests of the Fund. During my term as Alternate Executive Director and subsequently as Executive Director, I can attest unreservedly to the constructive, balanced and typically decisive contribution which Mr. Fischer has made in moving forward the Fund's work, in all its variety, in Africa. While always insisting on the imperative of macroeconomic stability, he has been deeply sensitive to the plight of post-conflict countries in the Continent and to the condition of those in acute indebtedness. He has an undisputed grasp of the vast social, poverty, infrastructure and human resource challenges confronting the growing range of African policymakers who are at the same time serious in meeting their macroeconomic challenges. And he is widely respected and highly regarded on the Continent, as an author, an academic, an economist, as a leader of the IMF and perhaps most highly cherished by African leaders, as a trusted advisor. As ample testimony to this, he was recently very widely acclaimed at the recent meeting of African Heads of State and Government in Libreville, as a leading figure on the international stage and a leader of integrity and stature of the Fund.

Before concluding, Chairman, let me also share the following with my colleagues. My chair assumes fully its responsibility to conduct the process of selection of our new Managing Director in the collegiate manner which I think we all favour. We have waited patiently for the tabling of candidates for this high office, believing that all nations and all regions of the world will have candidates of the required stature. We believe that this must indeed be the case.

It is my great pleasure to have the honour to nominate Mr. Fischer. In doing so, our Chair upholds and gives full substance to the three principles espoused by the G-11 Directors, eschewing any specific preference in favour of selecting the best possible candidate for the job, irrespective of nationality. In doing so, I earnestly hope that a long period of uncertainty can come to an end, to allow our institution to move forward with integrity and enormously strengthened by the signal that a capable, energetic and determined leader has been chosen. In doing so, we will allow the pebble to continue on its way, to pass the finishing line and come to the end of its journey.

As my statement may be of interest to Directors, I have arranged for copies to be made available to colleagues and I have just arranged for these to be provided to the Dean.

Stanley Fischer

1.  Background

Stanley Fischer is the First Deputy Managing Director of the International Monetary Fund, a post he assumed in September 1994.

Mr. Fischer was born in Zambia in 1943. He completed the B.Sc. (Econ.) and M. Sc. (Econ) degrees at the London School of Economics from 1962-66, and obtained his Ph.D. in Economics at (MIT) in 1969.

He was Assistant Professor of Economics at the University of Chicago until 1973, when he returned to the MIT Department of Economics as an Associate Professor. He became Professor of Economics in 1977. He has held visiting positions at the Hebrew University, Jerusalem, and the Hoover Institution at Stanford.

2.  Prior Appointments

Prior to taking up his position at the Fund, Mr. Fischer was the Killian Professor and Head of the Department of Economics at the Massachusetts Institute of Technology (MIT).

From January 1988 to August 1990 he served as Vice President, Development Economics and Chief Economist at the World Bank. He has also held consulting appointments with the U.S. State Department, the U.S. Treasury, the World Bank, the International Monetary Fund, and the Bank of Israel.

3.  Current Responsibilities

During his five and a half year period as First Deputy Managing Director of the International Monetary Fund, Mr. Fischer has held responsibilities for general oversight on all issues facing the International Monetary Fund. He has also discharged the following specific responsibilities:

  • Responsibility for the Fund's relations with an extensive range of individual member countries from all regions of the world
  • Research, Policy Development and general policy advice
  • The Fund's financial facilities and related policies
  • The Fund's work on the reform of the international financial system
  • Relations with the World Bank
  • Personnel policies
  • External relations

Mr. Fischer has served as the representative of the International Monetary Fund both at the Financial Stability Forum and at the G-20 Deputies Meetings. He has also been responsible for IMF surveillance of the G-7 countries. Mr. Fischer has represented the IMF at many other international meetings.

As part of his country responsibilities at the IMF, Mr. Fischer has overseen the establishment and conduct of Fund programs in countries as diverse as Russia, Brazil, Indonesia, Bosnia & Herzegovina, Mexico, Egypt, Argentina, Jordan and the Palestinian Authority. He has also played a critical role in influencing relations between the Fund and several important member countries.

During the absences of the Managing Director from IMF headquarters, Mr. Fischer has served as the Acting Managing Director on many occasions.

During his term at the IMF, he has delivered lectures on all aspects of the international financial architecture, monetary policy, financial policy, inflation targeting, and the role of the private sector in forestalling and resolving crises, among other topics.

4.  Publications & Other Responsibilities

Mr. Fischer is the author of Macroeconomics (with Rudi Dornbusch and Richard Startz). He is also the author of Lectures in Macroeconomics (MIT Press, 1989, with Olivier Blanchard), Economics (Second edition, McGraw Hill, 1988, with Rudiger Dornbusch and Richard Schmalensee), and Indexing, Inflation, and Economic Policy (MIT Press, 1986); and the editor of other books, among them Securing Peace in the Middle East (MIT Press, 1994). From 1986 to 1994 he was editor of the NBER Macroeconomics Annual; he has also served as Associate Editor of other economic journals. He has published extensively in the professional journals.

Mr. Fischer is also a Fellow of the Econometric Society and the American Academy of Arts and Sciences, a member of the Council on Foreign relations, a Guggenheim Fellow, and a Research Associate of the National Bureau of Economic Research.