France's Lagarde poised to become next IMF chief

WASHINGTON Mon Jun 27, 2011 4:04pm EDT

France's Finance Minister Christine Lagarde waves as she departs after a day of meetings ahead of her potentially being named the next managing director of the International Monetary Fund, at IMF headquarters in Washington, June 23, 2011. REUTERS/Jonathan Ernst

France's Finance Minister Christine Lagarde waves as she departs after a day of meetings ahead of her potentially being named the next managing director of the International Monetary Fund, at IMF headquarters in Washington, June 23, 2011.

Credit: Reuters/Jonathan Ernst

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WASHINGTON (Reuters) - French Finance Minister Christine Lagarde on Tuesday will likely be named the next head of the International Monetary Fund despite a strong challenge to Europe's traditional hold on the job.

An informal survey by Reuters of voting countries indicated Lagarde should easily get the majority support needed over Mexico's central bank governor, Agustin Carstens, to become the next managing director of the global lender.

Carstens picked up endorsements from Canada and Australia late on Friday in a significant challenge to Europe's grip on the post, but it is unlikely to change the outcome.

The 24-strong IMF board of member countries will meet on Tuesday to try to reach a decision, and will aim to reach a consensus without driving the matter to a formal vote.

On Monday, board officials were in consultations in an effort to determine whether either candidate had a clear majority, according to IMF board and European officials.

The race has been one of the most hotly contested in IMF history. Developing countries have aggressively urged that the process be based on qualifications and not on nationality, despite Europe's large voting bloc.

The determining voice will be the United States, which has been silent on who it supports. The Obama administration is widely expected to back the 55-year-old Lagarde to preserve the long-standing convention with Europe under which Americans hold both the IMF No. 2 spot and the presidency of the World Bank.

Japan and China, which rank second and third behind the United States in voting influence, have also refrained from publicly supporting any candidate. However, IMF board officials said both countries are likely to vote for Lagarde, and the head of China's central bank told Dow Jones Newswire on Monday that China had expressed "quite full support" for Lagarde.

Washington holds close to 17 percent of the vote, while European nations account for somewhere between 40 to 47 percent.

Countries such as Egypt, Indonesia, South Korea and French-speaking African nations early on declared their support for Lagarde, but have only marginal voting power.


The IMF job became vacant in May after the resignation of Dominique Strauss-Kahn, who has been charged with sexually assaulting a hotel maid in New York. He denies the charges.

Although a self-proclaimed long-shot candidate, Carstens has vigorously campaigned on his experience as a former IMF official, as well as dealing with developing world economic crises.

He has won wide backing in Latin America, with Peru and Chile endorsing him on Friday. While Brazil has been silent on whether it supports him or not, IMF board officials expect Brazil to join the rest of the region.

Supporters of Lagarde cite her political and economic credentials throughout Europe, which is the focal point of IMF efforts to head off another global economic downturn.

Both candidates have committed to hand more IMF voting power to emerging economies and have promised even-handed advice to both advanced and developing countries.

Developing nations want their growing clout in the global economy reflected at the IMF, but have won only modest increases in voting power so far.

Israel's central bank governor, Stanley Fischer, another favorite among developing countries, was disqualified as a candidate because he is over the 65 age limit for first time managing directors.

The continuing inability to mount a serious challenge to Europe's dominance in the IMF caused two potential contenders -- former Turkish Economy Minister Kemal Dervis and ex-South African Finance Minister Trevor Manuel -- to decide against running.

Before his downfall in May, Strauss-Kahn oversaw a shift in voting power that gave emerging markets greater say. He also named a Chinese to an IMF special adviser post, a step short of giving Beijing a coveted top IMF job.

(Editing by Sandra Maler)

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Comments (2)
squidcutter wrote:
She should already tell you
that she resign to face
a serious criminal investigation.
Just read:

Re: An Urgent Formal Notice, Complaint and
Informal Call to IAACA’s
Members and Executives regarding
Severe Criminal, Corrupted and
Un-Ethical International Proceedings
and Nominations in IMF
and World Bank’s – A Members’
Urgent Call to Cancel,
Prevent and Delay for a 60 days period,
all Proceedings
and Actions concerning Candidacy
or Nomination of
both Ms. Madelyn Antoncic (June 23rd)
and Ms. Christine Lagarde (June 30th)
until Clearance of Allegations

4. We could not find in IMF’S published
“Statement given by Christine Lagarde to the
IMF Executive Board”
any reference to the
un-denied facts publicly informed
lately as follows:

“Jean-Louis Nadal, the public prosecutor
attached to France’s highest appeals court,
this month requested a judicial inquiry into
whether Lagarde abused powers in reaching
a 385 million-euro ($550 million) settlement
to a two-decade-old legal dispute with
Bernard Tapie, former Socialist (!!) minister who endorsed
Sarkozy’s presidential effort.”

5. Lately we were informed, not by Ms. Lagarde,
that the court needs another extension to decide on the
public prosecutor’s serious requested inquiry.

6. Even the detailed IMF website “Bio”
made my clients worry that we might find ourselves,
rushing for no persuasive reason, in another political
and / or criminal storm.

7. As we understood, Ms. Lagarde had
a successful U.S. private civil attorney –
career in a famous American law firm,
when unexpectedly she was called
on 2005 by a former French Prime Minister,
Dominique de Villepin to serve
as a minister in France.

8. After a short period Mr. P.M. Villepin was fired
and indicted shamefully for some criminal
perjury and / or ugly
false – allegations’- incrimination – conspiracy
againsthis opponent, the then
new elected President Nicolas Sarkozy.

9. By the way, Sarkozy, became lately the rival
of the “promising potential
French Socialist Party favorite”,
whatever, the detained and very
seriously indicted former
IMF M.D., Dominique Strauss-Kahn.

10. So after Ms. Lagarde political patron,
de Villepin,
was deported by his criminal charges,
his victim and newly elected opponent, Sarkozy,
offered Ms. Lagarde to stay, and even promoted her,
as we learned from her IMF “Bio”,
after she has filed, as a minister,
Sarkozy’s biggest sponsor Tapie’s 20 years
law suit against France,
meaning, the treasury –
instead of real court – to a convenient
secret arbitration,
whatever, where he won $ 550 million (!!)
of France’s Treasury (on a very suspicious legal case)

11. If I may, 25 years ago I was honored to serve
as the legal assistant/clerk (“stager”)
of Israel’s Chief Justice,
Meir Shamgar. Shamgar’s legal opinion as
Israel’s Attorney General,
40 years ago, stands still even today:

“The state never agrees to participate in arbitration instead and outside of courts”,
exactly because this kind of scandals.
No appeal on these secret arbitrations.

12. I am sure brilliant attorney Lagarde had some sense,
or “Ethics” and “Code of Conduct”, as Ms. Virginia R. Canter,
IMF and DSK’s “Ethics Advisor’s 2010
Annual report” emphasizes:
“My staff and I look forward to working with all of you
to further the Fund’s outstanding
reputation as a leader in
rigorously applying the principles of transparency
and good governance to its own internal operations.”

Jun 27, 2011 4:41pm EDT  --  Report as abuse
stambo2001 wrote:
Reuters time and again fails to report the criminal investigation she’s involved in. Unbiased journalism is dead. Not hard to tell who the owners of Reuters want as the IMF head.

Jun 28, 2011 6:58am EDT  --  Report as abuse
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