Christine Lagarde (photo, from lemonde.fr), the French finance minister, will become the first woman to head the International Monetary Fund (IMF).
In a statement the IMF said: “The executive board of the International Monetary Fund today selected Christine Lagarde to serve as IMF managing director and madame chairman of the executive board for a five-year term starting on July 5, 2011.”
Christine Lagarde, 55, was elected “by consensus” by the 24-member executive board.
Former IMF chief Dominique Strauss-Kahn resigned after being arrested in May in New York for an alleged sexual assault. He denies the charges.
Ms Lagarde’s candidacy was supported by America, Europe, Russia and key emerging market nations, like China, India and Brazil.
“The results are in: I am honoured and delighted that the board has entrusted me with the position of MD of the IMF!” Ms Lagarde said via Twitter minutes after the announcement.
French president Nicolas Sarkozy said her nomination was “a victory for France”.
US Treasury Secretary Timothy Geithner said: “Minister Lagarde’s exceptional talent and broad experience will provide invaluable leadership for this indispensable institution at a critical time for the global economy.”
Ms Lagarde’s opponent for the post was Augustin Carstens, the governor of Mexico’s central bank. He said he had sent her his “best wishes and full support” and added that he was sure that she would be “a very capable leader of the institution”.
He also said he hoped she would “make meaningful progress in strengthening the governance of the institution”.
During his campaign Mr Carstens argued that this time the IMF chief should reflect the emergence of developing nations as an economic force.
But since the IMF was created in 1944, it has been a tradition that an American gets the top job at the World Bank while Europe gets the IMF.
To reassure IMF members who could fear that she would be too focused on Europe, in a statement Ms Lagarde said: “I will make it my overriding goal that our institution continues to serve its entire membership.
“As I have had the opportunity to say to the IMF board during the selection process, the IMF must be relevant, responsive, effective and legitimate, to achieve stronger and sustainable growth, macroeconomic stability and a better future for all.”
But the new IMF chief’s first task will be to deal with the efforts of the institution and the European Union to resolve the Greek debt crisis, as well as prevent contagion to other countries in the eurozone.
Ms Lagarde talked about this in a television interview minutes after her appointment. On a day of riots and protests throughout the country, she said: “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 also said she wanted to meet Mr Strauss-Kahn, if permitted to by the US government.
“I want to have a long talk with him, because a successor should talk with their predecessor.”
She added: “I can learn things from what he has to say about the IMF and its teams.”
A former champion swimmer, Christine Lagarde was an anti-trust and employment lawyer in the US before moving into politics. She was minister for foreign trade for two years before becoming France’s finance minister.
Her replacement in the French government is expected to be named by the French president on Wednesday.