European finance ministers said today that bailouts in the euro zone would carry on without IMF chief Dominique Strauss-Kahn, who has been charged with sexually assaulting a maid in a New York hotel.
Mr Strauss-Kahn had been due to attend a meeting in Brussels on Monday to discuss a 78-billion-euro aid package for Portugal. He was replaced at the meeting in Brussels by IMF Deputy Managing Director Nemat Shafik.
Mr Strauss-Kahn was denied bail at a New York court hearing on Monday and will remain in custody.
Making only the briefest of comments on the case, European finance ministers said Mr Strauss-Kahn's absence made no difference to their discussions, adding he should be considered innocent until proven guilty.
"I am pleased to say that the dialogue today is continuing, with ... the International Monetary Fund," said French finance minister Christine Lagarde, regarded as one of the front-runners to fill Strauss-Kahn's shoes at the Fund.
Mr Strauss-Kahn, himself a former French finance minister, had been widely expected to resign in the coming weeks to contest the Socialist candidacy for April 2012 presidential elections, for which he had been the front-runner.
European sources said that Ms Lagarde, an ex-lawyer with a fondness for the United States, where she worked for many years, had been gathering support for the top job at the Washington-based lender before Mr Strauss-Kahn was arrested.
European ministers, led by Germany's Wolfgang Schaeuble, were unanimous in saying that Mr Strauss-Kahn was innocent until proven guilty and should be given time to defend himself.
But, given the seriousness of the allegations against him, some EU officials appeared muted in their support.
"Those who have special responsibilities have to be specially careful in respecting the law," said Spain's Elena Salgado, one of three female euro zone finance ministers.
Despite reforms to IMF shareholding last year to boost the voice of fast-growing emerging economies, European nations retain a strong voice at the fund, with Europe's four largest economies ranking among the top 10 shareholders.
Some ministers suggested that, with the IMF playing a crucial role in Europe's sovereign debt crisis, a decision could come quickly on the future of Mr Strauss-Kahn, who has been replaced as acting managing director by IMF number two, John Lipsky.
"We will know quite soon what the repercussions are and the steps to be taken at the IMF, but for the time being let's allow Dominique Strauss-Kahn to at least present his version of events," said Belgian finance minister Didier Reynders.
German Chancellor Angela Merkel said that, while it was premature to discuss a replacement, it made sense for Europe to keep the job for the time being given its role in tackling the euro zone crisis.
Euro zone finance ministers approved a €78 billion emergency loan programme for Portugal today.
Reuters