EU seeks to end saga over the next IMF nomination

EU finance ministers will seek to end the embarrassing split over who to nominate for the top job at the International Monetary Fund (IMF) when they meet today. They will also finalise their contribution to this month's Lisbon EU summit.

Italy has assured Germany it supports its new candidate to head the IMF, German parliamentary speaker Mr Wolfgang Thierse said at the weekend.

It looks increasingly likely Germany's nominee, European Bank for Reconstruction and Development head Mr Horst Kohler, will be put forward.

The EU's previous candidate for the job, German deputy finance minister Mr Caio KochWeser, foundered on resistance from the US, the Fund's largest shareholder.

Asked at a political rally in Berlin yesterday to confirm a report in Der Spiegel magazine that Italian Prime Minister Mr Massimo D'Alema had given Mr Kohler his blessing during a visit last week, Mr Thierse said the report was correct.

Italy appeared last week to be cool on the bid by Mr Kohler. Foreign Minister Mr Lamberto Dini seemed to suggest he did not have the qualifications. France, Britain and EU presidency-holder Portugal have already publicly expressed support for Mr Kohler.

But Der Spiegel reported that Washington was seeking to block him. It quoted unnamed diplomatic sources in Brussels as saying they believed President Clinton was rallying international opposition to Mr Kohler via a "telephone campaign".

Mr Koch-Weser dropped his bid last week after accusing the US of secretly campaigning against him "on an absolutely unbelievable scale in all parts of the world".

Asked to comment on the report of a US campaign against Mr Kohler, a German government spokeswoman noted he had not yet been nominated as the EU's official candidate.

Washington has so far made no direct public comment on Mr Kohler's chances of heading the global lender.

Mr Koch-Weser's forced withdrawal was a diplomatic slap in the face for the Chancellor, Mr Gerhard Schroder, and his campaign to have Germany better represented in international posts.

Today's meeting will begin as usual with a meeting of the 11 euro-zone finance ministers. A European Central Bank spokesman said ECB vice-president Mr Christian Noyer would attend in place of the president, Mr Wim Duisenberg.

The Brussels-based European Voice newspaper reported on Friday the EU's March 23rd-24th summit in Lisbon would call for budgets to be oriented more towards investment in infrastructure.