More Change on 19th Street: Rodrigo de Rato Leaves the IMF

Rodrigo de Rato's announcement Thursday that he will step down as Managing Director at the IMF following the Fund and World Bank annual meetings in October took almost everyone by surprise (see Washington Post article). The timing was especially puzzling, as the announcement comes just as much of Mr. de Rato’s reform agenda is moving from concept to reality. Mr. de Rato's aggressive pursuit of reforms at the Fund, both its governance and its substantive focus, has been a pleasant surprise to those who worried about just what he would bring to the IMF when he first took office. (Read more about CGD's July 2006 event, Renewing the IMF's Commitment to Low-Income Countries, with Rodrigo de Rato on reforming the IMF's commitment to low-income countries.)

From an institution firmly stuck in the past, de Rato has moved the Fund into first place in the competition to reform the multilateral system. Of course, a great deal more needs to be done (a few more voting shares for China and other emerging market economies is not going to solve the governance problem, but it's a start), but de Rato was instrumental in moving the Fund from a state of denial to an institution having an active and productive debate about its own future.

As Mr. de Rato moves on to whatever it is he chooses to do next, we can only hope that the reform momentum he has help to create is sustained by the next Managing Director. And, of course, how his successor is selected will inevitably reignite the debate on the closed process that produces the heads of the World Bank and IMF. It's interesting, if idle speculation, to think about what might have happened on that front had de Rato announced his departure a month ago.