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Dominique Strauss-Kahn resigns as head of IMF

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Strauss-Kahn, who is facing charges of sexual assault and attempted rape, denied the allegations in his letter of resignation


Dominique Strauss-Kahn has resigned as head of the IMF

Dominique Strauss-Kahn has resigned as managing director of the International Monetary Fund, saying he wanted to devote “all his energy” to battle the sexual assault charges he faces in New York.

The IMF’s executive board released a letter from Strauss-Kahn dated 18 May, in which the former managing director denied the allegations against him and went on to say that it was with “infinite sadness” that he presented the board with his resignation.

“I think at this time first of my wife – whom I love more than anything – of my children, of my family, of my friends. I think also of my colleagues at the Fund; together we have accomplished such great things over the last three years and more.

“To all, I want to say that I deny with the greatest possible firmness all of the allegations that have been made against me.

“I want to protect this institution which I have served with honour and devotion, and especially – especially – I want to devote all my strength, all my time, and all my energy to proving my innocence.”

His resignation comes after increasing international pressure for him to step down as he faces charges of assaulting a hotel employee at a New York hotel. The maid, a 32-year-old immigrant from the West African nation of Guinea, told police that the 62-year-old Strauss-Kahn came out of the bathroom naked, chased her down, forced her to perform oral sex on him and tried to remove her underwear before she broke free and fled the room.

Strauss-Kahn, who is currently being held in New York’s Rikers Island prison, is to make a second application for bail on Thursday in New York with is his lawyers set to offer new bail terms including $1m in cash and to place their client under house arrest.

A judge rejected his initial plea for bail agreeing with prosecutors that he was a flight risk.

A grand jury has now been convened to assess whether Strauss-Khan will be indicted. Their decision will not be known until Friday. The decision to press for bail ahead of Friday’s decision suggests lawyers are urgently trying to free Strauss-Kahn from Rikers where he has been held since Monday. If he is released on bail, the deadline to secure an indictment would be extended.

The IMF’s statement late on Wednesday said the process of choosing a new leader would begin, but in the meantime John Lipsky would remain acting managing director.

Several potential candidates to replace Strauss-Kahn have already been suggested, although none have yet indicated that they are interested. These include French finance minister Christine Lagarde, former Bundesbank president Axel Weber, and Kemal Dervis, Turkey’s former minister of economic affairs.

The IMF will hold a vote among its member countries to choose the next managing director. The US has the largest share of voting power, with 16.7% of the total votes, followed by Japan with 6%, Germany with 5.7% and the UK and France with 4.85% each.

To win, a candidate must attract 85% of the votes. Critics say it allows Washington and the leading European nations to control the process, so that that IMF is always run by a European in return for an American citizen at the head of the World Bank.

This status quo could be now be challenged, though. On Tuesday China, which holds just 3.65% of the voting power, said the selection of the next IMF leader should be based on “fairness, transparency and merit”.

Brazil’s finance minister Guido Mantega reitered this point on Wednesday, arguing that was important that the selection process is based on merit, rather than on nationality. Brazil, which is an important, fast-growing emerging economy, has just 1.38% of the voting power – less than Belgium or the Netherlands.

European leaders have reportedly been lobbying to maintain their grip on the IMF. German chancellor Angela Merkel indicated on Monday that she favoured another European at the helm of the IMF.

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Written by rohitkumarsviews

May 19, 2011 at 8:43 am

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