Press Release No. 06/182

Press Release: Economic Counsellor Raghuram Rajan Notifies IMF Management of Intention to Return to the University of Chicago

August 22, 2006

Mr. Raghuram Rajan, the International Monetary Fund's Economic Counsellor and Director of its Research Department, has notified IMF Managing Director Rodrigo de Rato of his intention to return to his professorship at the University of Chicago by early 2007 when his current leave of absence expires. A successor to Mr. Rajan, who was named to his current post in July 2003 (see Press Release No. 03/100), will be named in due course.

"When I took this job, I promised the Executive Board that I had every intent of staying the full three years that department directors are appointed for. That I have done. Recently, the Managing Director asked me if I would stay on for a second term. I checked with the University of Chicago, but they indicated their inability to extend my leave," Mr. Rajan stated today. "It is with regret, therefore, that I have told the Managing Director that I would like to return to the University of Chicago by early next year. I don't use the word `regret' lightly, because I have enjoyed every minute that I have spent here, and I think that, together, we have accomplished a great deal.

"I will stay on at the IMF through the end of the year to complete or substantially complete work that is in progress, including preparing a report on how to better integrate Financial Sector Analysis into the Fund's Article IV work. During the time I have been at the Fund, it has undertaken a complete review of its Medium-Term Strategy, a process to which the Research Department has contributed substantially. Research has also worked on bringing modern modeling techniques and techniques of exchange rate assessment to bear on our Article IV discussions with member countries. We have expanded work on finance, aid and development, the political economy of reforms, and reform of the IMF. In cooperation with the Asia and Pacific Department, Research has also analyzed the growth and integration of China and India into the world economy, and has put the Fund in the forefront of policy analysis and discussion on these two countries.

"In many ways, my job has been to bring the right people in, attempt to create an environment where staff can do their job, and then listen and learn from all that staff know and have found. I have learnt that the people in Research specifically, and the Fund more generally, are some of the most intelligent and dedicated people it has been my privilege to know, and I am sure I will miss being with all of you."

Managing Director de Rato issued the following statement to the IMF Executive Board regarding Mr. Rajan's decision:

"During his tenure at the Fund, Raghu has made many important contributions to the IMF and its membership. He has held the important position of Economic Counsellor during a period when the Fund has been going through a re-orientation of its direction and an intensive review of its core functions. In that role, he has ensured that the Research Department has had a major impact on the internal policy debate and in enhancing support for the Fund's operational activities. Raghu has also been an articulate and influential voice of the Fund on the need to seize the opportunities presented by globalization while pointing to the emerging risks stemming from global imbalances and rising oil prices.

"Raghu's open management style and collegial spirit have worked to create an attractive work environment for his staff. Moreover, he has provided management and the Executive Board with many innovative and insightful perspectives on a wide range of policy and operational issues facing the institution. His departure is a great personal loss for me, and I know he will be missed by his many friends and colleagues at the Fund."

For additional background on Mr. Rajan: http://www.imf.org/external/np/bio/eng/rr.htm.