IMF’s Georgieva gets European backing as board meets to settle future


European governments have decided to back Kristalina Georgieva at a meeting of the IMF’s big shareholders designed to settle her future as the fund’s managing director following allegations questioning her ethics in her previous position at the World Bank.

Germany, the UK and Italy are all minded to join France in supporting Kristalina Georgieva, according to officials briefed on the discussions. However the US, the fund’s biggest shareholder, has yet to disclose its position.

The US Treasury declined to comment on Friday. It had earlier this week emphasised the need for a “thorough and fair accounting of all the facts”. 

The fund’s executive board is meeting on Friday in Washington but it is unclear whether a consensus will be reached before Monday, when the IMF’s annual meetings with the World Bank begin.

Georgieva is accused of manipulating data in China’s favour in the 2018 edition of the World Bank’s widely followed Doing Business annual report while she was the bank’s CEO, a position she left for the IMF’s top job in October 2019. She has denied wrongdoing.

European leaders typically spearhead the selection process for the IMF’s chief, which one former senior staffer at the fund said may largely explain their support for Georgieva despite the controversy.

“It is a huge amount of egg on the face for the Europeans. Everyone will be saying, ‘why should they keep this exorbitant privilege they have’” to choose the managing director, the person said.

“The Europeans know that if Georgieva goes down, there will be calls to open [that process] up.”

Georgieva’s position was further complicated on Friday when Bloomberg reported that she had softened criticism of Brazil’s environmental policies in an annual IMF report on the country in July. Georgieva reportedly agreed to change the report after meeting Afonso Bevilaqua, Brazil’s representative to the IMF board.

Bevilaqua is also chair of the ethics committee’s inquiry into the allegations against Georgieva, according to an IMF staffer familiar with the process.

“The goal for the board and for all of us is that they be able to provide a clear path forward for this institution,” Geoffrey Okamoto, first deputy managing director of the IMF, told a town-hall meeting with the fund’s staff on Wednesday.

“We will need to take steps to rebuild our neutrality and integrity in the eyes of the public, and potentially in the eyes of some shareholders.”

Additional reporting by Guy Chazan in Berlin.