It appears that Senior Minister Tharman Shanmugaratnam is not going to be the next Chief of the International Monetary Fund (IMF).

According to Reuters, 65-year-old Bulgarian economist and CEO of the World Bank, Kristalina Georgieva, has been selected as the European candidate to lead the IMF.

Given that traditionally, the job of the Managing Director of the IMF has been held by a European, the prevailing sentiment is that Georgieva will very likely become the next IMF Chief.

So why has the IMF been dominated by Europe?

This is largely due to the contribution of European Union (EU) as a whole to the IMF's lending fund.

According to Cornell College Economics Professor Todd A. Knoop in Business Cycle Economics, the lending fund of the IMF is comprised of contributions that each country must make in order to become a member.

Under the IMF's quota system, each country's contribution to the fund also determines its proportional voting rights.

Given that the United States contributes about 17 percent and the EU contributes 32 percent, this translates into the U.S. holding 17 percent of and the EU holding 32 percent of the IMF's voting rights.

In comparison, China only contributes 4 percent to the fund, which means it also only holds 4 percent of voting rights.

Moreover, according to German media Der Spiegel, important decisions in the IMF require a majority of 85 percent to pass, which gives both the U.S. and Europe a blocking minority in their own right.

As such, should the IMF pass any major decision, it is crucial to secure the backing of both the U.S. and Europe.

Georgieva is not a shoo-in yet though

That's not to say Georgieva is all but confirmed.

This is due to her age of 65.

According to the Financial Times, the IMF's bylaws bar its sitting chief from being over 65 years old.

However, German media Deutsche Welle quoted diplomatic sources as stating that both the EU and the U.S. have since agreed to change the age rule.

Tharman may not be the next head but still leaves an impression

Nevertheless, Tharman's credentials as Senior Minister and chairman of the Monetary Authority of Singapore (MAS) have not gone unnoticed.

An opinion piece in Bloomberg by Ferdinando Giugliano stated that it would be wise for the IMF board to consider Tharman alongside Georgieva, should his name be put forward.

Giugliano cited Georgieva's credentials, highlighting her decades of experience in working for the World Bank and European Commission, as well her experience in dealing with difficult international stakeholders such as the U.S.

However, given that Europe's proportion of global income is currently decreasing, Giugliano added that it was important for the IMF to consider the best possible candidate, regardless of his or her background.

Still, it would not necessarily be a loss for Singapore should Georgieva eventually become the new IMF Chief.

Top image from PAUL J. RICHARDS/AFP/Getty Images