Excerpted from Jeremy Torobin Globe and Mail May 30, 2011 Harper straddles fence on IMF leadership
The Harper government has played both sides of the Old World-New World coin.
Last year, Mr. Flaherty was instrumental in keeping the Group of Seven’s gravitas on life support for a bit longer, hauling his counterparts up to Iqaluit for a meeting to lay the groundwork for the larger G20 gathering in Toronto instead of just letting the antiquated G7 club fade away. At the same time, Mr. Flaherty has rarely missed an opportunity to contrast the debt woes of Europe (or of the United States) with Canada’s relatively sound fiscal footing, and he took on the old economic order by rallying countries like China and India to oppose a bank tax.
Mr. Flaherty has pointedly noted that the countries that have been most vocal about the need for an open, merit-based selection process at the IMF – Brazil, Russia, China, India and South Africa – are all in the G20, one of whose oft-stated goals is to give emerging powers more say in running the global economy.
Though Ms. Lagarde is a tough negotiator and extremely popular with her counterparts around the world, there’s a strong case to be made that if nobody else emerges Canada should back Mr. Carstens, head of Mexico’s central bank, a former top IMF official and – perhaps most important – an influential economist from a NAFTA partner.
“If Carstens and Lagarde remain the only two candidates, then they will need to be assessed against the background and experience needed to run a global economic institution and their ability to garner support from the broad membership,” said Thomas Bernes, Canada’s former executive director at the IMF. “I would hope that Mr. Carstens’ much more extensive economics background and experience, and his coming from an important North American partner for Canada, would weigh heavily in the government’s decision.”
Indeed, backing Mr. Carstens could be symbolically important in building Canada’s trade links with Latin America. At the same time, former Canadian diplomat Colin Robertson pointed out, the government is also trying to seal a free-trade deal with the European Union.
In other words, supporting either candidate could theoretically serve or thwart Canada’s interests, which helps explain why most observers say staying neutral is the best course until it’s clearer whether other candidates are going to come forward. Especially since the Americans haven’t come out in favour of either Ms. Lagarde or Mr. Carstens.
“You don’t have to always come out on things,” Mr. Robertson said. “I think that’s probably what Harper’s thinking right now, that this is one where we don’t have to pronounce, there’s no percentage in going either way, so play it straight.’’