Christine Lagarde: France’s ‘rock star’ finance minister

Silver-haired and silver-tongued, Christine Lagarde has cut an impressive figure as the first female finance minister of a G7 power, earning a reputation for grace under fire during the global economic crisis.

If Lagarde succeeds in her bid to be managing director of the International Monetary Fund, she would be the first woman to head the global emergency lender.

The IMF’s former chief economist Kenneth Rogoff told the New York Times Lagarde was so popular at finance meetings that she was “treated practically like a rock star.”

A lawyer by training, the 55-year-old Paris native became France’s longest serving finance minister earlier this month, having held the position since 2007.

Fluent in English, Lagarde emerged as a leading figure in Europe’s response to the 2008 financial crisis as the then-head of the eurozone finance ministers.

With France currently in charge of the G20 group of the world’s largest economies, she has been the pointwoman on efforts to combat the effects of the crisis and reform the global financial system.

Complimented by some for her smooth handling of the monumental crisis and criticised by others for stubborness, Lagarde has become a fixture on the world stage, with close relations to her counterparts in most of the major capitals, from Beijing to Brasilia.

Although she studied law and political science, after being admitted to the Paris bar, she joined the international corporate law firm Baker & McKenzie, specialising in labour and anti-trust issues as well as takeovers.

She rose to become chairwoman of the Chicago-based firm’s global executive committee in 1999 and then of its global strategy committee in 2004.  

Lagarde returned to France in June 2005, joining the government as trade minister under president Jacques Chirac.

Nicolas Sarkozy named her agriculture minister upon taking office as president in 2007, and then in an unexpected reshuffle appointed her finance minister.

Lagarde imposed herself as a linchpin of his presidency, giving the ministry a stability it had not seen since the 1990s. Before her, seven ministers had held the office in seven years.

Mistakes, when they happened, were usually not in the realm of finance but trampling on French political sensitivities.

Lagarde landed in hot water after labeling French labour laws “complicated, too heavy” and responsible for freezing job growth.

She also trod on political toes by using “rigueur”, a hot-button French word for austerity, to describe a key Sarkozy policy of slimming the bloated bureaucracy by not replacing retiring civil servants.

And when France faced high petrol prices, Lagarde said the French should ride bikes, doing nothing to erase her reputation in some circles as out-of-touch.

But she held on to her job, and became even more valuable to Sarkozy. Only recent accusations of conflict of interest have clouded her political horizons.

In May a prosecutor called for a probe into her handling of a high-profile dispute that resulted in a 240-million-euro ($345-million) government payout to flamboyant tycoon Bernard Tapie.

But the French court has put off until July 8 – after the IMF is expected to choose a leader –deciding on whether to allow a probe.

Questions have also been raised about an investment by Lagarde in a start-up run by the son of a state-run agency boss she appointed.

But in both cases Lagarde has shrugged off the accusations, calling the Tapie allegations a “smear” and the start-up investment a contribution to help restart the French economy.