Translated material
Write to Strauss-Kahn
The new head of the IMF opened a mailbox
French socialist Dominique Strauss-Kahn has taken up his duties as head of the International Monetary Fund . On November 1, DSK (as he abbreviates himself) together with his wife, journalist Anne Sinclair, solemnly entered the IMF from the front entrance and took over the post from the retired Spanish Marquis Rodrigo de Rato.The first innovation associated with the arrival of Strauss-Kahn was not long in coming. For the first time in its history, the IMF published the terms of the contract under which the managing director receives his salary of just under $421,000 a year. The IMF report notes that in addition to his salary, Mr. Strauss-Kahn is also entitled to an amount of $75,000 per year to ensure a standard of living corresponding to the status of managing director of the IMF. In other words, together with the “status” the Frenchman’s permanent income will be almost half a million dollars. But this will also include payment for receptions and trips directly related to the activities of the foundation. The IMF also guarantees Mr. Strauss-Kahn reimbursement for his wife's travel expenses in cases where the fund's annual meeting does not take place in Washington (this happens every three years) or if the wife's travel is necessary in the interests of the fund. Such openness is most likely demonstrated for a reason, since similar sensitive issues about payment for travel have arisen before.
The contract specifies that although Mr. Strauss-Kahn is hired for a five-year term, he is free to terminate his “association with the fund” at any time by notifying the IMF in advance. But even after this, Mr. Strauss-Kahn will receive a pension under the fund's program. The contract even provides for such a case as the death of the head of the fund before Ms. Sinclair: then the pension will be paid to her and her children.
The salary of the head of the IMF, judging by published figures, has not changed compared to the previous managing director. Meanwhile, the fund is extremely strict on the issue of reducing expenses. The Financial Seven have reportedly called for a one-time 10% cut to the fund (together with the already planned 16% cut).
The issue of expenses will obviously become one of the main headaches for Strauss-Kahn as the head of the 2,700 IMF staff. At his first meeting with the press in his new capacity, the Frenchman confirmed that, taking into account the wishes of the G7, we are talking about a 16 percent reduction. But, he emphasized, “nothing has been decided yet”: the question of the fund’s priorities must first be answered. However, there is reason to believe that Strauss-Kahn fully agrees with the G7’s thesis on the need to link the new model of the fund’s income, which is currently being developed, with the structure of expenses. Critics of this idea note that it contains a false message, since the fund's expenses are constant and depend on the areas of its activities, while the new income model should support these activities.
Be that as it may, during the first days of work, DSK did not create any sensations - neither with a plus sign, nor with a minus sign. He told his new team that the best specialists in the world worked at the IMF, and he was very interested in direct communication with them. Strauss-Kahn said he would create a special email address where foundation employees could send their ideas and initiatives. The interlocutors of the Vremya Novostei correspondent at the IMF regarded this as “a completely understandable gesture on the part of a professional politician,” adding, however, that a similar system existed before.
A correspondent for the ITAR-TASS agency, who participated in the first meeting of the DSK with journalists, notes: “Debuting before the American and international press in Washington, Strauss-Kahn demonstrated openness and a good sense of humor, making a generally favorable impression on journalists.”
The new head of the IMF told reporters that the fund does not expect an economic downturn in the United States and in the world. “Of course, the problem is what the cumulative effect of various negative factors will be in the coming months, including not only the high cost of energy resources, but also the recent turmoil in financial markets,” Strauss-Kahn said. “As far as we can see, there are no clear signs that things will go further than a slowdown (in growth rates. - Ed. ).”
In this regard, Strauss-Kahn noted that in countries with emerging markets, including Russia, “things are going very well.” This, according to the head of the IMF, indicates the growing role of such countries “in maintaining growth at the global level.” It should be noted that the annual World Economic Review, published a month ago by the foundation, stated that half of global economic growth comes from China, India and Russia.
The blissful picture of Dominique Strauss-Kahn's assumption of a new position was disrupted yesterday by sources of the British The Daily Telegraph in London. An anonymous interlocutor of the publication at Her Majesty's Treasury reported that London has developed a plan to strengthen the IMF's supervision of global financial markets. This plan, according to the newspaper, provides for the creation of a new special unit, which allegedly could be headed by Alan Greenspan. The Daily Telegraph's source was very vague about the formal status of the proposed unit and the scope of its powers. If, nevertheless, the information presented really corresponds to London’s plans, then, most likely, we can talk about some kind of advisory body, a kind of “council of the wise.” True, such a body does not fit into the structure of the IMF or the rules of its work. In addition, the fund's main shareholders have traditionally tried to protect global financial markets from excessive attention from the IMF.
It is possible that the background of the signal sounded from London is connected with a change of leadership at the IMF. It is well known that the current British Prime Minister Gordon Brown has led the International Monetary and Financial Committee for almost a decade, a body that brings together 24 governors from shareholder countries (ministers of finance or heads of central banks) and determines the most important issues of the functioning of the fund. Recently, the Italian Tommaso Padoa-Schioppa was elected to the post of chairman of the IMFC, and the British were rumored to support another candidate. The appointment of the DSK in London was also supported with reluctance. Perhaps the British are not ready to accept the loss of positions in the IMF and pointedly reminded who shapes the fund's policy.