x Abu Dhabi, UAEMonday 24 July 2017

Lagarde declares candidacy for IMF

Christine Lagarde, the French finance minister, enters the running for the position of IMF managing director, as the organisation seeks to find a replacement for Dominique Strauss-Kahn - with video.

Christine Lagarde, the French finance minister, has been viewed as a safe pair of hands as the IMF negotiates the euro-zone debt crisis. Bertrand Langlois / AFP
Christine Lagarde, the French finance minister, has been viewed as a safe pair of hands as the IMF negotiates the euro-zone debt crisis. Bertrand Langlois / AFP

Christine Lagarde has announced her candidacy to be the managing director of the IMF, potentially becoming the first woman to hold the position.

"It is an immense challenge which I approach with humility and in the hope of achieving the broadest possible consensus," Ms Lagarde said at a news conference in Paris.

Among the challenges for whoever becomes the IMF chief will be continued market fears that Greece will be forced to restructure its debts, which Ms Lagarde said she opposes "in principle".

Ms Lagarde, 55, has already led a distinguished career. She is the French finance minister and the first woman to hold such a position in a G8 country.

Fluent in English, personable and a former chairman of Baker & McKenzie, a US law firm, Ms Lagarde has been viewed as a safe pair of hands as the IMF negotiates the euro-zone debt crisis.

Speculation has mounted over who will succeed Dominique Strauss-Kahn, who resigned last week as managing director and is awaiting trial in New York on charges of sexually assaulting a hotel maid.

Ms Lagarde will square off against Agustin Carstens, the Mexican central bank governor.

Russia's finance minister lent support to Grigory Marchenko, Kazakhstan's central bank governor, according to Reuters.

The French finance minister has attracted considerable support from European countries, which control the largest proportion of votes at the IMF, with the EU, the UK, Germany and Italy having declared support for her candidacy.

The UAE, which holds 0.27 per cent of the votes at the IMF, has yet to declare support for a candidate.

However, some governments of emerging countries have been unhappy over the possibility of a European again running the IMF.

Since the fund's creation in 1945, the role of managing director has by custom always gone to a European and presidency of the World Bank has always gone to an American.

IMF executive directors representing Brazil, Russia, India, China and South Africa this week urged the fund to abandon "the obsolete unwritten convention that requires that the head of the IMF be necessarily from Europe".

Attention now turns to the US, which holds 16.8 per cent of the votes, as it decides which candidate to support.

ghunter@thenational.ae