The IMF Vice boss surprisingly gives up her post. This offers Trump the chance to name a successor to him – and to drive his very personal agenda at the IMF.
Number two at the International Monetary Fund (IMF), Gita Gopinath, will surprisingly give up her post at the end of August – and thus help US President Donald Trump an unexpected chance. Traditionally, the US Ministry of Finance proposes candidates for the vice post.
Gopinath’s departure offers the US administration the opportunity to recommend a successor to it – at a time when Trump tries to restructure the global economy by all means.
Sharp criticism of the Trump government At the IMF
Trump’s trade policy recently caused tensions between the US administration and the IMF. IMF boss Kristalina Georgieva warned that Trump’s tariffs could slow down global economic growth and increase the risk of a global financial crisis.
Conversely, the current policy of the US government’s IMF is a thorn in the side. “The creeping expansion of the missions” had paid both the IMF and the World Bank from the course, Finance Minister Scott Bessent already said on the occasion of the spring conference of the two institution. He accused the IMF to get lost in political “buzzwords” such as climate protection, gender justice and social issues.
IMF boss Kristalina Georgieva has repeatedly emphasized that climate change is a profound threat to growth and prosperity. Accordingly, the IMF 2022 introduced the Resilience and Sustainability Trust: it helps poor and vulnerable states with cheap and long -term loans to become a resilient against external shocks such as climate change or pandemics.
The IMF climate policy angered Trump
The US government calls for a radical realignment of the IMF – but what are the aim of it? If you look at the recent statements of the US government, three core reforms that Trump are striving for for the IMF are emerging.
First, the return to macroeconomic core tasks. One wanted to “make the IMF back into the IMF,” said finance minister Bessent. The IMF should then concentrate on securing the stability of the international currency system – and leave out topics such as climate policy.
Second: strengthening the US leadership role in the IMF. Bessent has made it clear that the United States wants to have a stronger decision in the future with personnel, lending and strategic orientations. Even in the interest of everyone according to the motto: “America First Does Not Mean America Alone” – “America at first does not mean America alone”.
Third: a harder gait opposite China. The US government accuses the IMF of being too flexible towards China’s non-transparent lending and export surpluses.
Climate change and global Economic growth
But how do experts see these demands of the Trump government? Many economists such as Nobel Prize winners Joseph Stiglitz are convinced that the IMF cannot ignore climate risks, since they have a direct impact on currency stability, debt rates and growth.
A current OECD study from last month comes to the conclusion that the less is done for climate protection, the less economic growth is expected in this century. Conversely, better climate protection measures would bring three percent in 2050 and to 13 percent more growth in the year.
USA already have veto law in the IMF
Trump’s demand for a stronger role of the United States in the IMF is not shared by many experts. On the contrary, they still see poorer countries from the global south in this institution.
In fact, the major economic nations such as the USA, Japan, China and Germany dominate the IMF. The United States even holds 16.5 percent of the voting rights – which in fact ensures a veto law for important decisions for which a majority of 85 percent of the vote is required.
Does China keep the Yuan artificially low?
With its criticism of the IMF’s attitude to China, the Trump administration is not alone. Previous US governments, including those of Barack Obama and Joe Biden, repeatedly accused China of keeping the Yuan artificially low in order to obtain an unfair export advantage.
A undervalued currency makes Chinese products cheaper on the world market, while imports are more expensive – with the effect that trade surpluses increase.
According to a study by the Cologne Institute of German Economy (IW), the deficit in German goods trade with China has tripled between 2020 and 2024. The devaluation of the Yuan played a central role. IW economist Jürgen Matthes comes to the conclusion: “German politics should therefore emphasize China to significantly upgrade the Yuan compared to the euro.”
Trump should have a hard time with IMF agenda
The bottom line is that the withdrawal of IMF vice-chief Gopinath for the Trump government at the right time-and could become a key moment for the new adjustment of this institution in the sense of US interests.
It is questionable whether Trump can penetrate internationally with his reform agenda. Other countries should also see the attitude of the IMF critically against China. However, demands for a return to classic IMF tasks and a stronger US dominance are likely to meet significant rejection.
