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Austrian minister suggests Strauss-Kahn step down

Austrian minister suggests Strauss-Kahn step down

Austria's finance minister suggested Tuesday that the head of the International Monetary Fund should consider stepping down to avoid damaging the institution in the wake of his arrest for alleged sexual assault.
Dominique Strauss-Kahn was arrested in New York Saturday for allegedly attempting to rape a maid in his hotel room. A New York judge refused to release him on bail Monday.
"Considering the situation, that bail was denied, he has to figure out for himself, that he is hurting the institution," Maria Fekter told journalists as she arrived at a meeting of European finance ministers in Brussels.
Elena Salgado, Spain's finance chief, said Strauss-Kahn had to decide for himself whether he wanted to step down, considering the offenses he is accused of are "extraordinarily serious."
"If I had to show my solidarity and support for someone it would be toward the woman who has been assaulted, if that is really the case that she has been," she said.
Other European officials were more supportive of the IMF's managing director. "I'm very sad and upset. And he's a good friend of mine," Luxembourg Prime Minister Jean-Claude Juncker said Monday night.
"I didn't like the pictures I've seen on television," Juncker added, referring to footage that showed Strauss-Kahn in handcuffs being escorted by police outside a New York precinct house.
Strauss-Kahn hasn't yet officially stepped down. But few analysts expect him to remain.
His arrest isn't expected to impede the IMF's day-to-day functioning. The executive board can still approve loan packages. And it's expected to authorize rescue loans to Portugal as part of a larger package that European finance ministers negotiated Monday.
Still, the incident complicates delicate negotiations among European leaders and the IMF over whether and under what conditions to send more aid to Greece. Last year's aid package hasn't been enough to resolve Greece's debt crisis. Speculation is rising that Greece may have to restructure its debts.
"An element of uncertainty has been injected at a time when the situation is extremely fragile," said James Rickards, senior managing director at Tangent Capital Partners.
Before his arrest, Strauss-Kahn was widely expected to step down within months and run for president of France. So the IMF's executive board has likely already been considering replacements.
A new managing director could be selected as early as June or July, Rickards said. A global financial summit will be held in November in Cannes, France, and the IMF will be under pressure to have a new permanent leader in place well before then.
The IMF's second-in-command, John Lipsky, who was named acting managing director, is viewed as more of a technocrat than Strauss-Kahn, with less political sway, particularly in Europe. And Lipsky has said he will step down in August, when his term ends.
"The combination leaves the IMF leaderless at the most critical time in its existence since the end of World War II," Rickards said.
Strauss-Kahn is regarded as one of the savviest leaders in the IMF's 64-year history, with deep ties to European policymakers. He played a vital role in negotiating last year's joint European Union-IMF bailout package for Greece and other struggling European countries.
He's also been viewed as an effective advocate for Europe's interests before the IMF's executive board, which represents its member countries.
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Christopher S. Rugaber and Martin Crutsinger in Washington contributed to this report.


Updated : 2021-06-19 06:16 GMT+08:00