Zeti one of Bloomberg columnist’s top picks to head IMF
The position became vacant following the resignation of Dominique Strauss-Kahn who was arrested in New York, and is presently facing sexual assault charges.
In his column yesterday, Pesek proposed that an Asian take over the role of the global institution that has traditionally been filled by Europeans and shortlisted regional candidates which he felt could bring a fresh perspective to the institution.
Pesek praised Zeti (picture) for her “street smarts” and said that she was part of the team that “bet against the IMF and won” in the aftermath of the 1998 Asian Financial Crisis when Malaysia declined aid from the IMF.
“In the late 1990s, it seemed inevitable that Malaysia would join Thailand, Indonesia and South Korea in accepting multibillion-dollar IMF bailouts and stringent conditions like raising interest rates, cutting spending and letting irresponsible companies fail,” said Pesek.
“Malaysia said no and Zeti helped it weather the turbulence. And then she watched the US, in the height of hypocrisy, do all the things it told Asian officials not to do. Zeti would bring a different perspective to the IMF, one much-needed.”
Pesek noted that Zeti is one of the most internationally respected central bankers and played a key role in turning Kuala Lumpur into a global hub of the USD 1trillion (RM3 trillion) Islamic finance industry.
The other Asian officials favoured by Pesek were Japanese economist Haruhiko Kuroda, former Indonesian Finance Minister Sri Mulyani Indrawati, the former head of the IMF’s independent evaluation office Montek Singh Ahluwalia.
The veteran financial columnist said that the idea that an European run the IMF is an “anachronistic” idea given that the West still comprises the core of a financial system that is tilting toward Asia and that it makes sense to tap someone from a region that rebounded from its own financial crisis in stunning fashion to help Europe deal with its current one.
He said that it is time for Asians to ask: “Isn’t now the time to install one of their own as IMF managing director?”
Strauss-Kahn resigned as head of the IMF on May 18, four days after his arrest.
Zeti was the first woman in Malaysia and Asia to head a central bank and scored an ‘A’ in the annual Central Banker Report Card by the New York-based Global Finance magazine, alongside Jean-Claude Trichet (European Central Bank), Glenn Stevens (Reserve Bank of Australia), Stanley Fischer (Bank of Israel), Lee Seongtae (Bank of Korea), Fai-Nan Perng (Taiwan Central Bank) and Durmus Yilmaz (Central Bank of Turkey).