Finance Minister Christine Lagarde the France reacts after the announcement that it has been selected as the new head of IMF, in the studios of TV TF1 in Boulogne-Billancourt, near Paris, June 28, 2011.
Credit: Reuters/TF1By Lesley WroughtonWASHINGTON. Tue, June 28, 2011 6 pm EDT
WASHINGTON (AFP) - the Minister of French finance Christine Lagarde Tuesday captured the top job of the IMF, keeping the international lender between the hands of a European at a time of growing concern to a default value of Greek debt as possible.
LaGarde, who starts his term of five years as Director-General on 5 July, will find itself immediately plunged into efforts by the IMF and the European Union at the head of a Greek default which could trigger an international crisis.
Minutes after his appointment, pressed Lagarde of Greece to move quickly push through unpopular austerity measures that the IMF and EU say are a prerequisite for some help.
"If I have a message this evening on the Greece, it is to appeal to the Greek political opposition in support of the party which is currently in power, in a spirit of national unity," she told TF1 television.
LaGarde, 55, the first woman at the head of the IMF, the successor to Dominique Strauss-Kahn, who resigned from the IMF in May to defend himself against charges of sexual assault against a New York hotel maid. He denies the charges.
His skills as a difficult bargaining with a reputation for bargains to seal under pressure will be weight that it moves to defend the economic interests of the France to the supervision of an international institution which must be considered as a neutral player in the world.
Succession race was one of most hotly contested in the history of the emerging MFIS of nations market expressed dissatisfaction with the 64-year tradition of having a European head of the IMF and an American lead sister institution, the World Bank.
In a Financial Times blog, Mohamed El-Erian, Chief Executive Officer of Pimco, the largest investor of binding of the world, said that Lagarde would need to show the efforts of the IMF to help distressed European countries were not politically motivated.
He said that she would need to prepare for the possibility that the IMF could face losses of rescue plan big loans made in recent years, including the 30 billion euros for the Greece.
LaGarde must also demonstrate a commitment to meritocracy by eliminating some appointments based on nationality, El-Erian added, quoting the position of n ° 2 of the Fund which traditionally goes to an American.
Washington is considering already appoint the White House Advisor David Lipton to succeed John Lipsky IMF second in command at the end of August, according to sources close to discussions of.
FINDING CONSENSUS
Selection of Lagarde to the Central Bank Governor Agustin Carstens of the Mexico was assured after the United States clearly support and emerging markets China, Brazil, the India and the Russia did likewise.
French President Nicolas Sarkozy called the new appointment of Lagarde "a victory for the France".
Carstens, said that he hoped that Lagarde would continue "significant progress in strengthening the governance of the institution, to ensure legitimacy, cohesion and ultimately, its effectiveness."
Developing countries, resentment in a process which favored a European from the outset, said they would hold Lagarde to his promise to give them more voting power in the Fund.
Emerging markets have long called for greater say in the IMF to take account of their weight in the global economy. They have threatened to leave the fold of the IMF unless that imbalances of power electoral fund are corrected.
Strauss-Kahn pushed through changes in the voice that benefited mainly large emerging economies such as China, the India and the Brazil, but not as much as they wanted.
"RIGGED SYSTEM."
Finance Minister Guido Mantega to the Brazil said Brazil sustained Lagarde because it promised to continue "raise the profile of emerging markets" in the IMF. "We hope that the commitment is met," said Mantega.
Arvind Subramanian, senior fellow at the Peterson Institute in Washington, said emerging economies had missed a golden opportunity to force change at the head of the IMF by failing to rally around Carstens, or putting in place their own candidate of consensus.
"It is a fake system must change, but... the only reason that the result is that (developing countries) wanted to because the emerging-market countries do not seize the opportunity,"Subramanian said."".
The global development group Oxfam said appointment of Lagarde is "ridiculous" and had damaged the credibility of the IMF.
"There were noises concerning the opening, but the decision was made before that the candidates were interviewed, said Sarah Wynn-Williams, head of Oxfam in relations with the IMF and the World Bank."
The United States, worried by the possibility of contagion from the Greek crisis, warned that the appointment of the next IMF Chief should not be delayed.
The Board of IMF progressed despite persistent concerns about a legal matter unresolved in France research on the role of Lagarde in a payment of arbitration 2008 to a French businessman.
Lagarde said she was "completely indifferent" by the case. A top French court postponed a decision on the matter until July 8.
The IMF may decide not to offer a contract to Lagarde to what the Court makes a final decision, said a Council source.
(Reporting by Glenn Somerville on Washington, Luciana Lopez in Brasilia and Alexandria Sage and Catherine Bremer additional Paris)
(Editing by Paul Simao, Jan Paschal and Andrew Hay)
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