MacroScope

Spain to vote for Carstens at IMF, but heart not in it

May 31, 2011

Carstens and Lagarde in earlier days

Mexico has won Spain’s vote in the leadership contest for the International Monetary Fund. Or rather, it appears Mexico is effectively telling Spain how it will vote. Of course, Spain’s problem is that it doesn’t really have a vote.

Mexican Central Bank Governor Agustin Carstens and French Finance Minister Christine Lagarde are the only declared candidates to head the International Monetary Fund after Dominique Strauss-Kahn resigned to fight sexual assault charges.

Both have embarked on a global tour to drum up support for their bids, with Lagaarde starting off in Brazil this week while Carstens headed for Spain and Portugal. Spanish Economy Minister Elena Salgado said on Tuesday Spain would like to support Lagarde, but the IMF’s voting structure would oblige it to vote for Carstens.

Spain’s economy is bigger than Mexico’s but it does not have a seat at the IMF’s executive board, which will decide who will succeed Strauss-Kahn as head of the global lender. Mexico has a seat, however, and Spain is part of its “constituency” along with several Latin American countries.

For Spain, it looks like a bitter pill to swallow from former colony Mexico, where people still refer to Spain as the madre patria, or the motherland.

This still leaves Carstens’ bid as a longshot. France says Lagarde has the support of the G8 nations, which would easily win her the vote. That doesn’t mean all of Europe is behind her, even if its heart is.

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