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WASHINGTON: The International Monetary Fund on Tuesday named Chinese economist Zhu Min to a new deputy managing director's position, giving long-awaited recognition to China's huge power in the global economy.
The IMF also named White House aide David Lipton to the Fund's number-two position, replacing outgoing first deputy managing director John Lipsky.
They were the first appointments made by new IMF managing director Christine Lagarde, who arrived last week promising a greater role for the world's large emerging economies, currently underrepresented on the IMF board and management.
Zhu, 58, has been a special adviser to the IMF managing director since 2010. While the new deputy managing director position was created generally for an emerging economy representative, it was widely expected that someone from China, the world's second-largest economy, would fill it.
The former Chinese central banker “brings a wealth of experience in government, international policy making and financial markets, strong managerial and communication skills as well as an institutional understanding of the Fund, and I look forward to his counsel,” Lagarde said in a statement.
“He will play an important role in working with me and the rest of my management team in meeting the challenges facing our global membership in the period ahead, and in strengthening the Fund's understanding of Asia and emerging markets more generally,” she added.
Zhu was a deputy governor of the People's Bank of China, and previous served in various positions at the Bank of China. The economist also worked six years at the World Bank, and has taught at Fudan University in China and Johns Hopkins in the United States.
Lipton, 57, President Barack Obama's adviser on international economic affairs and a former IMF staffer, was named as first deputy managing director.
A gentleman's agreement has allowed Europeans to keep the top position in the Fund since 1946, while an American has always been number two.
Lagarde praised Lipton for his “international expertise, public sector policy making and private sector experience, and a proven track record in economic crisis management.”
He will start at the Fund at the end of this month, while Lipsky, who has been deeply involved in Europe's debt talks as the IMF representative, will remain as a special adviser to Lagarde through November.
Both Lipton and Zhu have to be approved by the IMF board of directors, but that is seen as a formality.
Zhu's appointment is likely to assuage some of the complaints that the IMF's management team - the managing director and her now-four deputies - are overly dominated by the old and mature economies -- the United States, Europe, and Japan.
There are two other deputy managing directors: Japan's national Naoyuki Shinohara, and US-Britain-Egypt triple-national Nemat Shafik, appointed on April 11.
The IMF is already implementing a plan to elevate the power of the largest emerging economies on the board - China, India, Brazil, Russia, and South Africa, especially.
Lagarde has pledged to pursue that plan, even though it will mean a reduction of the powerful voting power held by her European backers.
