Bets are on for Carney at IMF

Prime Minister Harper thinks Mark Carney is a wonderful central banker — others think so too.

Bank of Canada Governor Mark Carney delivers a speech to the Canadian Club of Ottawa in Ottawa on Monday.

Bank of Canada Governor Mark Carney delivers a speech to the Canadian Club of Ottawa in Ottawa on Monday.

OTTAWA — Prime Minister Harper thinks Mark Carney is a wonderful central banker — others think so too.

The Bank of Canada governor, who has been named by Time magazine as one of the world’s most influential men, is being taken seriously in international circles as a possible replacement for disgraced International Monetary Fund head Dominique Strauss-Kahn.

With Strauss-Kahn in a New York jail on a sex assault charge, calls for a permanent replacement have been growing and potential candidates are emerging, among them Carney.

London bookmaker William Hill has placed Carney as a 10:1 pick for the prestigious international job.

Those are still long odds — the favourite is Turkish politician and economist Kemal Dervis at 5:2, but it places the Canadian banker, who made his name working at Goldman Sachs, in elite company.

According the odds, Carney is tied for sixth place with John Lipsky, currently the IMF’s acting head, and just behind former British prime minister Gordon Brown.

Asked the question after announcing a new cabinet in Ottawa, Harper praised the work of Carney, but did not get drawn into the speculation over the IMF job.

“I’m going to be careful what I say,” he responded. “We are discussing with our partners at the IMF what the appropriate steps are under these circumstances.”

About Carney, he added: “He’s doing a wonderful job as governor of the Bank of Canada. I have great confidence in him.”

Oddly, Carney was asked the same question on Monday and did not completely rule out his candidacy, although he noted that he still has four years remaining in his seven-year mandate.

Carney said he believed the choice should be made strictly on “merit” and not on geographical considerations. All past heads of the IMF have come from Europe, but leaders at the G20 summit in London said the practice should be changed in future.

“We agree that the heads and senior leadership of the international financial institutions should be appointed through an open, transparent and merit-based selection process,” the leaders said in a statement.

That may be fine in theory but it will be a hard habit to break, said John Manley, a former Canadian deputy prime minister who was believed to be up for the NATO secretary general post in the early 1990s,

“I would fully expect the Europeans will vote as a block as they always do and that will be that,” he said.

“But if there was ever an opportunity to break the pattern, this would be it when it’s a rather unexpected, rapid development.”

Manley said Carney is “extremely well-respected internationally,” not only for his work at the bank, but as also prior to that as Canada’s G20 deputy in Finance.

But even if the IMF breaks the pattern, Carney would face another kind of challenge, from the emerging economies who believe they have gone unrecognized too long.

South Africa’s finance minister said Wednesday that the time had come to appoint someone from an emerging country, a sentiment also expressed by Brazil.

Carney’s star has risen internationally in part because of Canada’s relatively strong economic performance during the recession and in part because of his own sure-footed presence at international meetings.

Last year, U.S.-based Time magazine named Carney its 21st most influential person, the only central banker to make the list.

“Central bankers aren’t often young, good-looking and charming, but Mark Carney is all three — not to mention wicked smart,” the magazine said in an effusive profile.