US endorses Lagarde to head IMF

28th June 2011, Comments 0 comments

The US declared its support for French Finance Minister Christine Lagarde to head the International Monetary Fund, all but assuring that she will be chosen when the board meets Tuesday.

"I am pleased to announce our decision to support Christine Lagarde to head the International Monetary Fund," Treasury Secretary Timothy Geithner said in a statement.

"Minister Lagarde's exceptional talent and broad experience will provide invaluable leadership for this indispensable institution at a critical time for the global economy."

The long-expected US endorsement virtually ensured Lagarde's choice over Mexican central bank chief Agustin Carstens to become the executive director of the global crisis lender, capping a five-week race after the May 18 resignation of Dominique Strauss-Kahn to fight charges in New York of sexual assault.

The backing of Washington and Europe gave Lagarde the support of 49 percent of the voting quotas on the 24-member IMF executive board.

Added endorsements of Russia, China and other countries ensured she would be over the 50 percent mark, although the board said it wants to decide by consensus rather than a vote.

Despite grumblings from emerging economies over Europe's 65-year lock on the executive director job, there was little doubt that the key IMF power, the United States, would support Lagarde, making it nearly impossible for Mexican challenger Agustin Carstens to win the position.

Choosing Lagarde would ease European concerns that the Fund's crucial bailouts of Greece, Portugal and Ireland could be disrupted by the unexpected departure of Strauss-Kahn.

"We are encouraged by the broad support she has secured among the Fund's membership, including from the emerging economies," Geithner said.

"I also want to commend my friend, Agustin Carstens, on his strong and very credible candidacy."

With their crisis festering, Europe's powers aggressively put forward Lagarde within days of Strauss-Kahn's arrest.

Though not an economist, she has gained wide respect as France's point-woman during its leadership of the G20 as well as in European debt talks.

Despite her strong suit, Lagarde toured the world to convince emerging economic powers like China and India that she would not be too biased to take tough stances on Europe's bailouts of Greece, Ireland and Portugal.

"I am not here to represent the interest of any given region of the world, but rather the entire membership," she told the IMF board last week.

© 2011 AFP

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