well-connected Anglo-Iranian in a sign the global lender is setting out on a more forceful course of action in dealing with the European financial crisis.
The new chief in Europe is Reza Moghadam, currently director of the fund’s strategy, policy and review department. He will replace Portugal’s former Central Bank Vice Governor Antonio Borges, who has made some stumbles.
The change won praise from many analysts who saw it as clear move to heighten the IMF’s profile in dealing with a sovereign debt crisis that doesn’t seem to want to go away.
“He [Moghadam] is seen as a very credible and powerful insider,” Eswar Prasad, a former IMF official and a senior fellow at Brookings Institution in Washington, told the Reuters news agency.
“It shows that the IMF intends to be much more assertive in playing a prominent role in Europe and Reza Moghadam is somebody who is seen as being able to move the Fund to that more aggressive position.”
Moghadam has been an influential behind-the-scenes policymaker in the Washington-based IMF, playing a key role in modernizing the Fund and adapting its lending tools to make them more relevant to rising emerging market powers.
He was instrumental in a report last year that looked at the IMF’s handling of the 2008-2009 financial crisis and has been a key IMF figure in the Group of 20. He has also helped sharpen the IMF’s focus on better monitoring economies.
Moghadam’s appointment comes amid rising concern Europe is unable to handle its growing sovereign debt crisis and the IMF will have to step in to play a greater role in stabilizing the situation.
Thus far, the IMF has been part of a rescue “troika” in Europe—along with the European Union and European Central Bank—looking for ways to aid debt-strapped countries and find a means for bailing out Greece.
There is growing concern the euro zone’s long crisis has now been overtaken by events and will need the IMF’s help to instill market confidence.
