Lagarde is First IMF Woman Chief, Carstens Bows out

Jiang Xufeng, Liu Lina

WASHINGTON, June 28 (Xinhua) — French Finance Minister Christine Lagarde was appointed managing director of the International Monetary Fund (IMF) on Tuesday, becoming the first woman to hold the top IMF post since its inception in 1944.

The IMF executive board selected Lagarde to serve as managing director and madame chairman of the executive board of the IMF for a five-year term starting on July 5, the Washington-based IMF said in a statement.

The 24-member board said Lagarde and Mexican central bank governor Agustin Carstens are both “well qualified” candidates and it decided on Lagarde by consensus. Lagarde won critical backing from key IMF members including the United States.

Courtesy: Xinhua

U.S. Treasury Secretary Timothy Geithner on Tuesday voiced support for Lagarde over Carstens hours before the IMF’s final decision, saying Lagarde’s exceptional talent and broad experience would provide invaluable leadership for the institution at a critical time for the global economy.

“I am deeply honored by the trust placed in me by the executive board. I would like to thank the Fund’s global membership warmly for the broad-based support I have received. I would also like to express my respect and esteem for my colleague and friend Agustin Carstens,” Lagarde said in a statement following the appointment.

The 55-year-old former lawyer said that the IMF must be “relevant, responsive, effective and legitimate,” in an effort to achieve stronger and sustainable growth and macroeconomic stability.

“The IMF has served its 187 member countries well during the global economic and financial crisis, transforming itself in many positive ways. I will make it my overriding goal that our institution continues to serve its entire membership with the same focus and the same spirit,” added Lagarde, the 11th European to head the agency, amid an escalating European debt crisis.

“I welcome the selection of Christine Lagarde as managing director for the IMF, and extend her my best wishes and full support. I am sure that Lagarde will be a very capable leader of the institution,” Carstens, the former IMF deputy managing director, said in a statement following Lagarde’s appointment.

Carstens said he hoped the IMF could make “meaningful progress” in improving its governance to assure the legitimacy, cohesiveness and effectiveness, under Lagarde’s direction.

World Bank President Robert Zoellick on Tuesday also welcomed the appointment of Lagarde as the new head of the IMF, the Bank’s sister agency.

“I would like to congratulate Christine Lagarde on her appointment as managing director of the IMF. The IMF plays a critical role in the global financial system. The World Bank Group and the IMF have worked ever more closely in the last few years to support countries as they recover from the global economic crisis, and to avert crises going forward,” Zoellick said.

“Wherever she has worked, she has had a strong voice and impact. I look forward to working closely with her and with the IMF under her

leadership,” Zoellick added.

Tharman Shanmugaratnam, Singapore deputy prime minister and finance minister, said on Tuesday in a statement that he was confident that Lagarde would lead the IMF with a clear sense of purpose, ensure that the Fund preserves the independence it needs to sustain its effectiveness, and promote a spirit of consensus that cuts across its entire membership.

“I have spoken with Lagarde and we agreed on the importance of continued reforms to the governance of the Fund, so as to reflect the evolving balance in the global economy and financial system,” noted Shanmugaratnam, also the chairman of the International Monetary and Financial Committee (IMFC), the primary advisory body of the IMF’s Board of Governors.

“This includes securing full implementation of the 2010 reforms and pressing ahead with the review of the quota formula that will commence before the Annual Meetings in September this year.”

Lagarde has been French finance minister since June 2007. Prior to that position, she served as France’s minister for foreign trade for two years. She also had an extensive career as an antitrust and labor lawyer.

The IMF started the process to select its new chief in late May to succeed former head Dominique Strauss-Kahn, who resigned on May 18 to face alleged sexual assault charges in New York.

The managing director is the chief of the IMF’s operating staff and chair of the executive board. The chief is assisted by three deputy managing directors in the operation of the Fund.

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