French Finance Minister Christine Lagarde launched a bid yesterday to head the International Monetary Fund, vowing to run as a candidate even if judges probe her role in a business dispute.
If appointed, Lagarde, a former champion swimmer, would be the first woman to head the IMF, taking over from her countryman Dominique Strauss-Kahn who resigned to fight charges of sexually assaulting a New York hotel maid.
Lagarde, a respected figure on the world financial stage, has received wide European backing for the post, although emerging powers have complained that the job should not automatically go to a European, as is IMF tradition.
“I have decided to present my candidacy” for the job, she told reporters, adding that she had made the decision “after mature reflection”, with the backing of French President Nicolas Sarkozy.
The embarrassment that Strauss-Kahn’s arrest caused French authorities has not deterred other European powers from endorsing another French candidate to head the global lender, nor have the judicial proceedings hanging over Lagarde.
In the latest words of international support, German government spokesman Steffen Seibert said that Berlin “strongly backs” Lagarde’s candidacy.
Judges are due to decide on June 10 whether they will agree to a prosecutor’s demand that they investigate allegations that Lagarde exceeded her authority in the way she handled a high-profile dispute involving tycoon Bernard Tapie which resulted in a big compensation payout.
“I have every confidence in this (judicial) procedure and I have a perfectly clear conscience” about the Tapie affair, Lagarde told reporters.
“If the investigation goes further, I will still maintain my candidacy.”
The fund is the global emergency lender with a key role in calming the effects of the financial crisis on public finances in Europe.
An EU source said on Friday that Lagarde, 55, was practically certain to become Europe’s candidate, although she has been dogged by accusations over her decision to appoint independent arbitrators in the Tapie affair.
Lagarde gained fresh endorsements yesterday, with the head of the European Commission Jose Manual Barroso saying he fully supported her candidacy.
Germany, France, Britain and Italy have backed her. Key IMF voting power the United States, where Lagarde is generally respected, and Japan have yet openly to declare a preference.
Barroso said in a statement that Lagarde’s credentials and commitment to reforming economic governance were “indispensable to accomplish the mission of the IMF and its vital contribution to the stability of the international economy.”
Lagarde has cut an impressive figure as the first female finance minister of a G7 power, earning a reputation for grace and grit amid the storms of the global financial crisis and now the eurozone debt crisis.
The IMF post is traditionally held by a European, but emerging economies complain that it should be opened up to their candidates.
IMF directors from Brazil, Russia, India, China and South Africa – the so-called BRICS economies – said in a declaration that Europe’s longstanding grip on the IMF leadership “undermines the legitimacy of the Fund.”
The 2008-2009 financial crisis in the United States and Europe showed the need to reform institutions like the IMF “to reflect the growing role of developing countries in the world economy,” they added.
Lagarde said yesterday: “Being European is not a handicap, nor an asset.”