Monday 20 November 2017

The Punt: IMF's Lagarde is winning hearts and minds in Beijing

Christine Lagarde
Christine Lagarde

Christine Lagarde has said she's open to serving a second term as head of the International Monetary Fund. Now that she's steered the lender to give the yuan reserve-currency status, it's likely that she can count on support from communist China.

Lagarde announced on Monday that the board of the Washington-based IMF approved adding the yuan to the fund's basket of reserve currencies, alongside the dollar, euro, pound and yen. The decision is a victory for President Xi Jinping's authoritarian government. And it endears Ms Lagarde to the powers that be in Beijing.

"It looks like she has a perfect chance of being reappointed," Domenico Lombardi, director of the global economy programme at the Centre for International Governance in Canadan, told Bloomberg. "China has no reason whatsoever to deny support."

During her time at the helm, Lagarde has tried to give China a greater voice at the institution. In 2011, in one of her first actions, she created an additional deputy managing director position for former People's Bank of China official Zhu Min, the first Chinese national to hold such a senior post at the fund. She visited the country within months of her appointment. That level of support may win her support in Beijing. See graphic, p44-45

Irish Independent

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