FRANCE’S CHRISTINE LAGARDE IS FIRST WOMAN CHIEF OF IMF

French Finance Minister Christine Lagarde on Tuesday was selected the first-ever woman managing director of the International Monetary Fund, maintaining Europe’s grasp on the top job at the global lender.

“I am deeply honored,” the 55-year-old Ms. Lagarde said in Paris after her selection was announced.

She begins her five-year term July 5 amid an escalating debt crisis in Europe and growing fears that Greece will default.

“The executive board, after considering all relevant information on the candidacies, proceeded to select Ms. Lagarde by consensus,” the IMF said in a statement.

Minutes after her appointment, Ms. Lagarde pressed Greece to move quickly to push through unpopular austerity measures that the IMF and EU have said are a prerequisite for further aid.

“If I have one message tonight about Greece, it is to call on the Greek political opposition to support the party that is currently in power in a spirit of national unity,” Ms. Lagarde told TF1 television.

Ms. Lagarde succeeds 62-year-old Dominique Strauss-Kahn, also of France, who resigned abruptly on May 18 after being arrested in New York on charges of rape and assault of a room maid at an upscale hotel.

Ms. Lagarde’s victory over Mexico’s Central Bank Governor Agustin Carstens was assured after the United States made its support clear and emerging market economies China, Brazil and Russia did the same.

The 24-member board called both Ms. Lagarde and her rival for the position, Mexican central banker Agustin Carstens, “well-qualified candidates” and said that it decided on Ms. Lagarde by consensus

She will have to immediately deal with an IMF-European Union effort to keep debt-stricken Greece afloat and focus on potentially thorny IMF “spillover reports” that analyze the economic and policy actions of the world’s major economies.

Despite grumblings from emerging economies over Europe’s 65-year lock on the IMF’s top job, the solid support of the United States and European nations made it virtually impossible for Mr. Carstens.

Choosing Ms. Lagarde was expected to ease concerns in Europe over the Fund’s support for the fragile bailouts of Greece, Portugal and Ireland in the wake of the unexpected departure of Mr. Strauss-Kahn.

French President Nicolas Sarkozy’s office declared it a “victory for France.”

“Minister Lagarde’s exceptional talent and broad experience will provide invaluable leadership for this indispensable institution at a critical time for the global economy,” US Treasury Secretary Timothy Geithner said in a statement.

Few had expected Washington to break the tacit pact, dating to the founding in 1944 of the International Monetary Fund and sister institution the World Bank, that an American would run the Bank while a European headed the Fund.

The 187-nation Fund, which plays a crucial but often controversial role aiding countries in financial straits, was left reeling after Ms. Strauss-Kahn resigned in the middle of tense negotiations over Greece’s massive bailout and anxiety over other struggling European economies.

Mr. Strauss-Kahn, the IMF chief since 2007, was arrested in New York on allegations that he sexually assaulted a hotel chambermaid. He denies the charges, and remains under house arrest while preparing his defense.

Ahough not an economist, Ms. Lagarde has gained wide respect as France’s point woman during its leadership of the G20 as well as in European debt talks.

“The big advantage of Christine Lagarde is representing a continuity in the cooperation between the Fund and the Eurozone,” said a source close to the IMF.

Nevertheless, Ms. Lagarde had to tour the world to convince emerging economic powers like China and India that she would not be too biased to take tough stances on the European bailouts.

“I am not here to represent the interest of any given region of the world, but rather the entire membership,” she told the IMF board last week.

(Sara Ghasemilee, a senior editor with Al Arabiya English, can be reached at [email protected])