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Christine Lagarde, IMF chief with a key role in the Greek debt talks - profile Christine Lagarde, IMF chief with a key role in the Greek debt talks - profile
(about 4 hours later)
The former US treasury secretary, Timothy Geithner, says she has a “lightning-quick wit, a genuine warmth, and an ability to bridge divides”. Alastair Darling, the former British chancellor, also something of a fan, describes her as a “formidable operator” with an “unorthodox approach” who can “cajole people into agreement” and exercises “immense influence”. The former US treasury secretary, Timothy Geithner, says she has a “lightning-quick wit, a genuine warmth and an ability to bridge divides”. Alastair Darling, the former British chancellor, also something of a fan, describes her as a “formidable operator” with an unorthodox approach who can “cajole people into agreement” and exercises “immense influence”.
She will need all of that. Christine Lagarde, head of the International Monetary Fund and – says Forbes magazine – the world’s sixth most powerful woman, is in a delicate position as Greece’s latest repayment deadline looms and the debt-laden country seeks a last-ditch deal with its creditors to stave off bankruptcy and an exit from the eurozone. She will need all of that. Christine Lagarde, the head of the International Monetary Fund and – says Forbes magazine – the world’s sixth most powerful woman, is in a delicate position as Greece’s latest repayment deadline looms and the country seeks a last-ditch deal with its creditors to stave off bankruptcy and exit from the eurozone.
The Washington-based IMF has ideological objections to Greece’s current proposals, which rely mainly on tax increases to boost revenue rather than on spending cuts, arguing that the country’s tortured economy is already too heavily taxed and further hikes will only harm growth. Nor does it feel Athens’ broader plans to revive the economy go nearly far enough. The Washington-based IMF has ideological objections to Greece’s current proposals, which rely mainly on tax increases to boost revenue rather than on spending cuts, arguing that the country’s tortured economy is already too heavily taxed and further hikes will harm growth. Nor does it feel Athens’ broader plans to revive the economy go nearly far enough.
But the organisation is also unhappy with the reluctance of Greece’s other, European creditors – its eurozone partners and the European Central Bank – to come up with any concrete proposals on debt relief. The debt total now amounts to about 175% of Greek GDP and the IMF has long felt that without at least some long-term relief - writing off a proportion of the debt - Greece’s borrowings are unsustainable. But the organisation is also unhappy with the reluctance of Greece’s other, European creditors – its eurozone partners and the European Central Bank – to come up with any concrete proposals on debt relief. The debt total now amounts to about 175% of Greek GDP and the IMF has long felt that without at least some long-term relief - writing off a proportion of the debt - Greece’s borrowing is unsustainable.
The short-term future of Greece – and the integrity of the eurozone – may depend on how far Lagarde, a cool, always-elegant 59-year-old Frenchwoman, manages to “exercise influence”, “get people talking” and “bridge divides” not only between the leftist, Syriza-led Greek government of prime minister Alexis Tsipras and its creditors, but also among the lenders themselves. The short-term future of Greece – and the integrity of the eurozone – may depend on how far Lagarde, a cool, always elegant 59-year-old Frenchwoman, manages to exercise influence, get people talking and bridge divides not only between the leftist Syriza-led Greek government of prime minister Alexis Tsipras and its creditors, but also among the lenders themselves.
Lagarde has, though, another imperative: her term comes to an end next year, and whether she decides to seek re-election or return to national politics (she was French finance minister before replacing the disgraced Dominique Strauss-Kahn at the head of the IMF), she will not want a failed entanglement with Greece on her CV. Lagarde has, though, another imperative. Her term comes to an end next year, and whether she decides to seek re-election or return to national politics - she was French finance minister before replacing the disgraced Dominique Strauss-Kahn as IMF chief - she will not want a failed entanglement with Greece on her CV.
It was Strauss-Kahn who first committed the IMF to Greece in 2010, after eurozone governments approached the organisation for help in devising a bailout. The fund’s continued European engagement – including its decision to replace much of Greece’s private-sector borrowing with IMF money in 2012 – has been controversial, particularly in developing countries.It was Strauss-Kahn who first committed the IMF to Greece in 2010, after eurozone governments approached the organisation for help in devising a bailout. The fund’s continued European engagement – including its decision to replace much of Greece’s private-sector borrowing with IMF money in 2012 – has been controversial, particularly in developing countries.
Lagarde is not afraid to bang heads; she observed caustically last week that the long-drawn-out, on-off aid-for-reforms talks would benefit from the presence of some “adults in the room”. But with Tsipras determined not to backtrack on his anti-austerity election promises and eurozone governments insistent on both getting their money back and averting the break-up of the single currency, she will need all the talents former colleagues ascribe to her. Lagarde is not afraid to bang heads. She observed caustically last week that the long drawn out, on-off aid-for-reforms talks would benefit from the presence of some “adults in the room”. With Tsipras, however, determined not to backtrack on his anti-austerity election promises and eurozone governments insistent on both getting their money back and averting the breakup of the single currency, she will need all the talents her former colleagues ascribe to her.
Born in Paris in January 1956, Lagarde’s parents were both academics: her father, Robert Lallouette, a professor of English and her mother, Nicole, a Latin teacher. She famously represented France at synchronised swimming as a teenager (a sport she has said endowed her with a useful political skill: knowing how to “grit your teeth and smile”.) Born in Paris in January 1956, Lagarde’s parents were both academics. Her father, Robert Lallouette, was a professor of English; and her mother, Nicole, a Latin teacher. She famously represented France at synchronised swimming as a teenager - a sport she has said endowed her with the useful political skill of knowing how to “grit your teeth and smile”.
After her baccalaureate and following the death of her father, she spent a year in the US aged just 17, studying at a high school in Maryland but also spending time in Washington as a political intern on Capitol Hill. Back in France, she took degrees in English, labour law and social law at the university of Nanterre, and later a masters in political science in Aix, before returning to the US in 1981 to work for the international law firm Baker & McKenzie. After her baccalaureate and following the death of her father, she spent a year in the US aged 17, studying at a Maryland high school and spending time in Washington as a political intern on Capitol Hill. Back in France, she took degrees in English, labour law and social law at the university of Nanterre, and later a masters in political science in Aix, before returning to the US in 1981 to work for the international law firm Baker & McKenzie.
Starting out there as an associate specialising in labour, anti-trust, and mergers and acquisitions, Lagarde moved through the ranks to become a partner after six years and eventually head of the firm in western Europe. In 1999, she was elected its first ever woman chairman before being summoned back to France in 2005 by then-president Jacques Chirac to take up her first government post as junior minister for foreign trade. Starting out as an associate specialising in labour, anti-trust and mergers and acquisitions, Lagarde moved through the ranks to become a partner after six years and eventually head of the firm in western Europe. In 1999, she was elected its first woman chairman before being summoned back to France in 2005 by then-president Jacques Chirac to take up her first government post as junior minister for foreign trade.
By 2007 she was finance minister, the first woman to hold the post not just in France, but in any of the G8 major industrial economies. The Financial Times rated her Europe’s best finance minister in 2009 and a series of cool, commanding performances at key forums such as the G20 raised her international profile further. She took over from Strauss-Kahn at the IMF in July 2011. By 2007 she was finance minister, the first woman to hold the post not just in France, but in any of the G8 countries. The Financial Times rated her Europe’s best finance minister in 2009, and a series of cool, commanding performances at forums such as the G20 raised her international profile further. She took over from Strauss-Kahn at the IMF in July 2011.
A convinced vegetarian and a gym, swimming and cycling enthusiast who rarely, if ever, touches alcohol, Lagarde is divorced, with two sons now in their early 30s, and since 2006 has lived with a Marseille businessman. Her English is as immaculate as her tailored suits (she favours Chanel). A convinced vegetarian and a gym, swimming and cycling enthusiast who rarely, if ever, touches alcohol, Lagarde is divorced, with two sons now in their early 30s. Since 2006 she has lived with a Marseille businessman. Her English is as immaculate as her tailored suits (she favours Chanel).
Although widely admired by her colleagues – Kenneth Rogoff, the IMF’s former chief economist, describes her as “enormously impressive, politically astute and a strong personality” – she has not escaped all controversy. A comment to the Guardian in 2012 appearing to confirm that she felt “payback time” had come for Greece sparked outrage in Athens. Although widely admired by her colleagues – Kenneth Rogoff, the IMF’s former chief economist, describes her as “enormously impressive, politically astute and a strong personality” – she has not escaped controversy. A comment to the Guardian in 2012 appearing to confirm that she felt “payback time” had come for Greece sparked outrage in Athens.
And she remains under the cloud of an investigation for negligence over her role as finance minister in taking a long-running damages case brought against the state by businessman Bernard Tapie out of the courts and to an arbitration panel; Tapie was subsequently awarded more than €200m in damages. Her Paris apartment was searched in 2013 and she spent two days being questioning over the affair, but has consistently denied any misconduct and there is no suggestion of personal profit. She also remains under the cloud of an investigation for negligence over her role as finance minister in taking a long-running damages case brought against the state by businessman Bernard Tapie out of the courts and to an arbitration panel. Tapie was subsequently awarded more than €200m in damages. Her Paris apartment was searched in 2013 and she was questioned for two days over the affair, but has consistently denied any misconduct. There is no suggestion of personal profit.
By turns business-like and ineffably charming, straight-talking and surprisingly funny, Lagarde’s unusual mix of Gallic charm and Anglo-Saxon effectiveness is undoubtedly better appreciated in international circles than in France. The next few days could make or break her reputation.By turns business-like and ineffably charming, straight-talking and surprisingly funny, Lagarde’s unusual mix of Gallic charm and Anglo-Saxon effectiveness is undoubtedly better appreciated in international circles than in France. The next few days could make or break her reputation.