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Lagarde confirmed as head of IMF – and first woman in post

Stephen Foley,Richard Hall
Wednesday 29 June 2011 00:00 BST
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The French Finance minister, Christine Lagarde, was last night named as the new managing director of the International Monetary Fund (IMF) and will begin her term of office on 5 July.

Ms Lagarde's victory was secured when the US came out in favour of her candidacy yesterday ahead of the vote by the fund's members.

Tim Geithner, the US Secretary of the Treasury, said Ms Lagarde's "exceptional talent and broad experience will provide invaluable leadership for this indispensable institution at a critical time for the global economy".

The US is the largest contributor to the IMF and as such has the largest single share of the vote. Ms Lagarde also yesterday won the backing of Brazil, which broke ranks with other Latin American countries that had largely supported the Mexican central-bank chief, Agustin Carstens. Mr Carstens was campaigning to become the first person from an emerging-market economy to run the IMF, a job traditionally reserved for a European.

In an emailed statement he said he also hopes Ms Lagarde will "make meaningful progress in strengthening the governance of the institution".

The post has been vacant since May, when former head Dominique Strauss-Kahn resigned to defend himself against rape allegations. He is awaiting trial in New York.

In announcing her candidacy last month, Ms Lagarde, who is the first woman to head the organisation, said she would bring "all my expertise as a lawyer, a minister, a manager and a woman" to the job.

She campaigned for the post by promising to respect the growing influence of emerging-market economies. China and other countries have increased their funding to the organisation, which has used those funds to bail out advanced economies in Europe.

The Brazilian Finance minister, Guido Mantega, said yesterday that it chose Ms Lagarde not only for her experience, background and knowledge, but also for her commitment to continuing IMF reforms, "which implies increasing representation among emerging economies".

"We hope minister Lagarde will not only look at the European crisis, but will look at global problems," he added.

Shortly after her appointment was announced, Ms Lagarde called on the Greek opposition to support the government in pushing through a new austerity plan.

"If I have one message tonight about Greece, it is to call on the Greek political opposition to support the party that is currently in power in a spirit of national unity," she told TF1 television. She said the worst-case scenario would be for Greece to leave the eurozone and that it should be avoided at all cost.

Separately, Ms Lagarde said she was "completely unconcerned" about a legal investigation under way into an arbitration settlement case in which she was involved in 2008.

Ms Lagarde's term as head of the IMF will last for five years.

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