By Isabel Versiani and Glenn Somerville
BRASILIA/WASHINGTON (Reuters) - Emerging market countries lined up on Monday in strong opposition to the possibility a European could automatically succeed Dominique Strauss-Kahn as head of the International Monetary Fund.
After Britain over the weekend endorsed French Finance Minister Christine Lagarde as an "outstanding candidate" for the job, officials of emerging economies pushed back fiercely while they maneuvered to select a candidate of their own.
"A stench of colonialism is wafting around 19th and H streets in Northwest Washington, site of the headquarters of the International Monetary Fund," said Moises Naim, a former World Bank board director for Venezuela who is currently at the Carnegie Endowment for International Peace.
The IMF's board of member countries, which opened the formal nomination process on Monday, has set a deadline of June 30 to pick a successor. Brazil complained about the unusually speedy selection, saying more time was needed.
One potential candidate from emerging markets, Mexico's central bank chief Agustin Carstens, was expected to be named formally by Mexican Finance Minister Ernesto Cordero on Monday.
Strauss-Kahn is under house arrest in New York on charges of attempting rape a hotel maid, which he denies. He resigned on Wednesday. The IMF is being run by its No. 2 official, John Lipksy, who has said he wants to step down in August.
UNHAPPINESS MAY FORCE UNITY
The impression that Lagarde was already a frontrunner appeared to both rile emerging-market countries and to spur them to action to try to find their own candidate to break Europe's 60-year hold on the post.
"We have been approached by Mexico and South Africa and we are in touch with Brazil and other countries of the BRIC," an Indian finance ministry official who requested anonymity told Reuters. He was referring to the booming economies of Brazil, Russia, Indian and China. South Africa was recently added to the group.
However, it was clear emerging markets had not yet come to a consensus view on Monday on who to put forward.
Brazil, for example, declined to put its weight behind Mexico's Carstens. Brazilian Finance Minister Guido Mantega dodged reporters' questions on the topic.
"What matters here is having a good candidate, not nationality," Mantega said.
He suggested that whoever succeeds Strauss-Kahn should only serve the remainder of his term, which would have ended in September 2012. Full terms are for five years.
A truncated term seems unlikely to fly since IMF board members do not want to go through the tortuous and politically strenuous process of selecting a leader for anything less than a normal term.
WHO HOLDS THE POWER?
Fast-growing emerging-market nations have been pushed and pulled to take on a larger role in global institutions like the World Bank and IMF -- and to contribute more money.
Caught off guard by Strauss-Kahn's resignation, now they are resisting the "gentleman's agreement" that has assured a European will lead the IMF and an American the World Bank.
"European countries are vastly over-represented on the board," said Oxfam spokeswoman Sarah Wynn-Williams. "It's no longer tenable for Europeans to anoint an IMF head behind closed doors."
Oxfam was one of a coalition of groups that sent an open letter to the IMF board urging an open selection process rather than a "backroom deal" to pick Strauss-Kahn's successor.
Johannes Lin, a senior fellow specializing in global economy and development at the Brookings Institution in Washington, said a Europe-U.S. deal on a leader "would send another signal that the 'old powers' are not ready to accept the new economic reality."
"It would create the spectacle of the Europeans and the United States holding on to prerogatives whose time has passed and whose exercise results in national embarrassment such as we have seen in the wake of recent leadership upheavals at the World Bank and IMF," he wrote.
Leaders from the Group of Eight wealthy nations are expected to discuss the IMF succession at a meeting later this week in Deauville, France.
A factor cited by Lagarde backers is that the IMF needs someone immediately familiar with the situation in Europe, where the global lender is helping draft rescues for indebted nations like Portugal, Ireland and Greece.
But in a note to clients, global brokerage firm Newedge said that can cut both ways and that Lagarde could be viewed as "too interconnected to the crisis" and so less credible.
"She is also a French politician (as was Dominique Strauss-Kahn) and while I believe she would be less likely to use the position for her own political goals, she is also a Euro insider and could bring yet more political baggage into the equation," said Bill Blain, senior director of Newedge.
(Additional reporting by Lesley Wroughton in Washington, Jeremy Gaunt in London, and Abhijit Neogy and Manoj Kumar in New Delhi; writing by Glenn Somerville, Editing by Chizu Nomiyama)