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Lagarde in lead for IMF managing directorship

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Lagarde in lead for IMF managing directorship
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As nominations closed for the top job at the

International Monetary Fund, the contest was between French finance minister Christine Lagarde and Agustin Carstens, the governor of Mexico’s central Bank.

Carstens is not the favourite, even though emerging market powers like Russia, India and China have said they want an end to the practice of a European automatically running the global lender.

Sabina Dewan at the Center for American Progress, a left-wing Washington think tank, said she understands why Lagarde is likely to get the job: “I think that it’s important moving forward that the head of the IMF, the managing director, be chosen on the basis of merit not nationality. But I think for the moment it’s important to get someone in there that is capable, that is ready, and Christine Lagarde definitely fits that bill.”

There is one cloud hanging over Lagarde’s candidacy. A top French court has put off until next month a decision on whether to launch a formal inquiry into allegations that she abused her authority by approving a 285 million euro compensation payout to a businessman friend of President Nicolas Sarkozy.

Lagarde has said she has no concerns about that and the allegations are groundless.

On Friday South Africa’s Trevor Manuel ruled himself out of the race.

The respected former South African finance minister, opted not to stand but said it would be “most unfortunate if we end up with a European who is bound by the EU”.

“It is important to understand that decisions take place in the context of world politics. Against that backdrop, I have decided not to avail myself,” Manuel told a news conference.

Manuel, who handled Africa’s biggest economy deftly for a decade, had long been touted as an ideal developing-world candidate and many had seen him winning more support from emerging powers than Carstens, despite the Mexican’s impressive academic profile.

The African Union has said it wants to see a non-European in the job but emerging market powers have failed to coalesce behind one candidate to challenge Europe’s hold on the job.