April 18, 2024

A Favorite Emerges for Helm of I.M.F.

Ms. Lagarde looked him in the eye. “The best way for the banking sector to say thank you would be to actually have, you know, good financing of the economy, sensible compensation systems in place and reinforcement of their capital,” she replied, to a burst of applause.

Her straight talk has helped burnish Ms. Lagarde’s reputation as one of Europe’s most influential ambassadors in the world of international finance.

And now it is helping to make Ms. Lagarde, 55, perhaps the leading candidate to succeed her friend and colleague Dominique Strauss-Kahn as head of the International Monetary Fund. There is growing pressure on Mr. Strauss-Kahn to resign his post as the I.M.F.’s managing director to deal with charges of attempted rape, stemming from his encounter with a hotel maid in New York last Saturday.

Another of Ms. Lagarde’s selling points, though, may be one not listed on her résumé.

“What’s happened with Strauss-Kahn underscores how great it would be to have a woman in the role,” said Kenneth S. Rogoff, a former I.M.F. chief economist who is now a professor at Harvard University.

If she gets the post, Ms. Lagarde would be the first woman to run the I.M.F. — or any large international financial institution, for that matter. But Mr. Rogoff indicated gender was only part of her appeal.

“She is enormously impressive, politically astute and a strong personality,” he said. “At finance meetings all over the world, she is treated practically like a rock star.”

European officials are frantically maneuvering to keep one of their own in a post Europe has controlled since the I.M.F. and the World Bank were created in the late 1940s. It will not necessarily be easy. Three years after financial excesses in the United States and Europe brought the world economy to the brink of catastrophe, Mr. Strauss-Kahn has become the latest symbol of what many see as the faults of the wealthy West.

Appointing simply another European, particularly another white middle-age male, might not fly this time.

The world’s fast-growing emerging economies say they should now get a shot at running a big institution like the I.M.F. — or the World Bank, traditionally headed by an American in a long-standing understanding between the two economic powers.

But with Europe facing a drawn-out financial crisis of its own, global leaders may consider it politic for a European to finish serving out Mr. Strauss-Kahn’s term, which ends in 2012. That might then create an opening for a leader from one of the emerging markets — from South Africa or India, for example — whose collective economic heft and effect on global markets is starting to eclipse that of the West.

That is why Ms. Lagarde is seen as Europe’s lifeline. Her main competition,, analysts say, is another policy maker with an alternate profile, Kemal Dervis, a former finance minister of Turkey. Mr. Dervis is credited with rescuing the Turkish economy after it was hit by a devastating financial crisis in 2001, in part by securing a multibillion-dollar loan from the I.M.F. Before that, Mr. Dervis worked at the World Bank for 24 years.

But with the I.M.F. overseeing 100 billion euros (around $140 billion) in loans to Greece, Portugal and Ireland, Ms. Lagarde may be the best person to steer a transition at the I.M.F., analysts says, even if President Nicolas Sarkozy of France has not yet moved to put her in the running.

Ms. Lagarde has kept quiet about the rumors circulating about her potential candidacy. As one French official put it: “She knows that whatever she says will only diminish her chances. It’s best to stay above the fray and see what happens.”

But French officials do not doubt her ambition to move to I.M.F. headquarters in Washington if the opportunity arose. “She is without a doubt one of the top candidates people are talking about right now,” a French diplomat said.

Ms. Lagarde’s biggest drawback as a candidate, perhaps, is that she is French — like Mr. Strauss-Kahn. But recent history suggests that that is not a disqualifier. Between 1978 and 2000, two Frenchmen — Jacques de Larosiere and Michel Camdessus — were the successive chiefs of the I.M.F.

Article source: http://feeds.nytimes.com/click.phdo?i=a4df69e55199369df3795c24aacce7c5

Speak Your Mind