French finance minister tipped to take IMF post
Choice could be 'bad for Ireland's tax rate'
EUROPE'S three largest economies last night threw their combined weight behind French Finance Minister Christine Lagarde's candidacy to head the International Monetary Fund (IMF).
Ms Lagarde's (pictured below) candidacy gained significant momentum yesterday when a close ally of President Nicolas Sarkozy -- Interior Minister Claude Gueant, former chief of staff and one of his top advisers -- said she had the backing of several countries.
British Chancellor of the Exchequer George Osborne said Ms Lagarde, a 55-year-old former lawyer, was an "outstanding candidate" and German Chancellor Angela Merkel called her an experienced "figure of excellent standing".
With the support of the region's three largest economies, she would only realistically require the backing of the United States to secure the IMF post.
The race for the leadership of the IMF was thrown open last Thursday when Frenchman Dominique Strauss-Kahn resigned after being arrested on charges of attempted rape.
His departure opened a tug of war between Europe and emerging economies, which argue it is time to end 65 years of European domination.
Commentators in Ireland, however, have said Ms Lagarde's appointment might not be ideal for the country, considering Mr Sarkozy's entrenched position on seeking a change in our corporate tax policy.
Ms Lagarde's departure for Washington would rob Mr Sarkozy of a charismatic minister a year ahead of presidential elections in France, but it would hand him a powerful ally for France's ongoing presidency of the G20 and in eurozone debt-crisis talks.
With the IMF due to accept nominations from today, European powers have already started to close ranks behind a regional candidate, saying it is crucial the next managing director has knowledge of Europe, where the lender is heavily involved.
Ms Lagarde has won admirers in Washington and Beijing for balancing the interests of advanced and developing economies during France's G20 presidency this year.
Having worked in the United States as a lawyer for some 20 years, she also speaks flawless English.
Her chances received a boost on Friday when former Turkish economy minister Kema Dervis -- seen as the leading emerging market candidate -- ruled himself out of the running.
But the finance ministers of Australia and South Africa, who jointly chair a G20 committee on reform of the IMF, said yesterday the tradition that the fund's managing director was a European was out of date.
The IMF board has said a new chief would be appointed by June 30.