France’s Lagarde Heads to IMF

Christine Lagarde’s first duty will be to tackle the European debt issue.
France’s Lagarde Heads to IMF
6/28/2011
Updated:
10/1/2015

<a><img src="https://www.theepochtimes.com/assets/uploads/2015/09/117143609.jpg" alt="French Finance Minister Christine Lagarde delivers a statement outside the International Monetary Fund (IMF) headquarters in Washington, D.C. (Jim Watson/AFP/Getty Images)" title="French Finance Minister Christine Lagarde delivers a statement outside the International Monetary Fund (IMF) headquarters in Washington, D.C. (Jim Watson/AFP/Getty Images)" width="320" class="size-medium wp-image-1801769"/></a>
French Finance Minister Christine Lagarde delivers a statement outside the International Monetary Fund (IMF) headquarters in Washington, D.C. (Jim Watson/AFP/Getty Images)

PARIS—The International Monetary Fund’s Executive Board named Christine Lagarde, the French finance minister, as its new managing director on Tuesday to succeed Dominique Strauss-Kahn, who resigned last month.

Lagarde, 55, was the finance minister for France since 2007 with “an extensive and noteworthy career as an anti-trust and labor lawyer,” said the IMF. She will begin her five-year term starting on July 5.

“Dear Friends, it is an honor and a joy to announce that the Board of Directors of the IMF has to appoint me general director!” she said via her Twitter account.

However, Lagarde’s elation and the mountain of congratulations that she’s been receiving, could quickly be overshadowed by the huge tasks ahead of her.

Her first duty will be to tackle the European debt issue, which could involve excluding Greece from the eurozone. This would be “the worst scenario, and we should avoid it by all means,” said Lagarde, Le Monde reported.

Aside from her IMF duties, Lagarde has yet to resolve her legal problems in France, where she could face abuse of power charges.

Lagarde is accused of having influenced a 2008 arbitration decision offering huge financial compensation to business tycoon Bernard Tapie. Tapie was awarded a total of $449 million by the Commercial Dispute Resolution (CDR)—a government body aimed at managing the Credit Lyonnais debts—over the allegedly illegal sale of one of his companies, sport equipment giant, Adidas, by the Credit Lyonnais bank in 1993.

The Court of Justice of the Republic (CJR), which is in charge of judging if government officials have violated the law in the exercise of their duties, is expected to announce its decision regarding Lagarde in early July.

The CJR can decide that an investigation of Lagarde would be irrelevant, or ask for additional information, or start a formal investigation.

If Lagarde is investigated and found guilty of abuse of power, she could face up to five years in prison and be fined $100,000.

However, the IMF board may have made a safe bet in appointing Lagarde, since court cases of this type could take years to conclude. Thus, it is unlikely that potential legal woes would prevent Lagarde from fulfilling her five-year IMF term.

After one last French council meeting, Lagarde will resign from the French government and head to the IMF. Farewells, at least from the opposition, are not expected to be friendly.

Left Party leader, Jean-Luc Mélenchon, issued a statement saying, “There is nothing to be happy about. In France, she has been the agent of destruction for the French state.”

Center-right Parliament member, Nicolas Dupont-Aignan, who heads the Arise the Republic party, expressed similar sentiments. “One of the pyromaniacs gets promoted and becomes head of the firemen,” according to Le Nouvel Obs newspaper, adding, “This is not a victory for France but a triumph of a globalized and unregulated financial system that has in the former minister, its best advocate.”

Lagarde is the first woman to head the IMF since the institution was created in 1944. She beat out Mexico’s Agustin Carstens to win the post.