IMF Chief Christine Lagarde has been nominated as the head of the European Central Bank (ECB). She said that she was “honored” for her selection. Lagarde had been appointed the Chief of IMF for the second time and her second term was scheduled to expire on July 2021. If her appointment is approved by the European Parliament, she would take over as ECB president from Mario Draghi on October 31.
Lagarde would be temporarily stepping aside and she has named IMF First Deputy Managing Director David Lipton as the fund’s acting chief. IMF board has accepted her decision.
This move by Lagarde has forced the IMF to look for early succession. The IMF is considering ECB’s head Mario Draghi to lead the IMF.
Lagarde although a lawyer by training, has through the years become competent enough to lead one of the world’s biggest financial institutions. Her experience as the IMF’s head, as Finance Minister of France, her experiences through the financial crises of 2008 and with the Defaulting government of Greece, Lagarde has gained a wide range of experience to lead the ECB.
The Euro might come under a lot of pressure in the next financial crises. For that reason, experts say that for the times coming ahead ECB’s head needs to be more than just a financial expert. The Chief will need to have the political will to make crucial structural changes to make Europe financially strong and secure. Apart from that, ECB should be able to help the countries with weaker financial conditions in the time of crises.
Lagarde had told Yahoo Finance, in an interview in April that, many central banks were going for a digital economy, and that she was well aware of the big brands working for a monopoly over their respective businesses and will work on limiting their influence.
Experts say that IMF is losing a strong advocate for the benefits of trade, global growth that aids the poor and middle classes and the empowerment of women.
Some experts have pointed out the dark side of the changes as well. As some experts argue that there is a rivalry over these top positions in the EU between different countries of the EU and each nation tries to get the top positions and keep them in the hold. Right now, Germany and France, each got a top position, with France’s Christine Lagarde being nominated as ECB’s Chief and Germany’s Von Der Leyen being nominated for the Commission Presidency.
People considered for ECB’s Chief position included Bank of Finland Governor Olli Rehn, French Central Bank Chief François Villeroy De Galhau, Germany’s Bundes bank President Jens Weid mann and ECB executive board member Benoît Cœuré.