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France’s Lagarde Named to Head IMF

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French Finance Minister Christine Lagarde was named late Tuesday to succeed the disgraced Dominique Strauss-Kahn as head of the International Monetary Fund (IMF).

The appointment came although emerging market nations had hoped to see one of their own take the top spot. She will assume her new position on July 5, as talk over who will get the number-two slot at the IMF vies with speculation over who will succeed her as finance minister.

Reuters reported Wednesday that Lagarde had won the support of countries formerly supporting her challenger for the position, Mexico's Agustin Carstens. They now hope that she will live up to promises to assure greater presences in top positions within the IMF for countries that hitherto have not had much of a say.

A senior Indian government source was quoted saying, "Lagarde is a friend of India. We can't get the IMF managing director's chair for now but at least India can get some high-level appointments in the IMF during her tenure and we will work towards that."

China too hopes for a broader representation within the IMF, saying in the report that it wanted to see Lagarde begin reforms, with the organization doing more to promote global financial stability "and … increase the representation of emerging economies in the IMF governance structure."

Asia in general has put its faith in Lagarde's abilities. Hartadi A. Sarwono, Indonesia's central bank deputy governor, was quoted saying, "Lagarde has been more successful in consensus building to bridge relationships between advanced countries and emerging markets."

Meanwhile, in her native France, parliamentary sources said that Francois Baroin, budget minister and government spokesman, was the likely successor to Lagarde as finance minister. During a stormy meeting late on Tuesday, he reportedly threatened to leave the government if passed over in favor of Agriculture Minister Bruno Le Maire. President Nicolas Sarkozy was expected to name the new finance minister on Wednesday.

Another possible candidate for the position is Valerie Pecresse, minister of higher education, who has several advantages over Baroin. She is fluent in several languages—Baroin's English is seen as weak, and he joked about taking English lessons after the Tuesday meeting—with a strong background, and her appointment would allow Sarkozy to name a woman to a prominent government position. Several women have left his cabinet in the past few months.