Lagarde has Europe backing for new term as International Monetary Fund chief

Lagarde has been dogged off-and-on since her initial appointment in 2011 for her role in a long-running business scandal while she was France’s finance minister.

Spain will also back Lagarde and nominate her for a second term, an official source at the country’s Economy Ministry said on Thursday.

Despite current East-West tensions, former Finance Minister Alexei Kudrin said Russian Federation should be a part of Western institutions such as the Group of Seven and the OECD.

At a panel in Davos, Switzerland, Ray Dalio, the chairman of Bridgewater Associates, said the biggest concern was China’s currency.

Last month, a French judge ordered her to face trial for negligence in a special ministerial court over the 2008 payout of some €400 million to businessman Bernard Tapie.

The UK’s Chancellor of the Exchequer, George Osborne, has already said he is “delighted to nominate” her for a new term.

“I think it is hard for the United States to do much more at this stage”, Lagarde told France 2, pointing out that Washington – also the home of the International Monetary Fund – usually waits until the end of the election process before backing a candidate.

She said that the market needed “clarity and certainty” about China’s exchange rate basket “in particular with reference to the dollar, which has always been the reference”.

The IMF executive board aims to have decided by March 3.

Ms Lagarde, who is well regarded among global leaders, said in October she was “prepared to serve” another term, but that was up to the Fund’s members to decide. Lagarde has repeatedly pleaded her innocence in the case. The Greek program fostered a perception that the fund’s European and U.S. leadership gave its Western members preferential treatment.

Now the eurozone and Greece are preparing to negotiate another restructuring of Greece’s debt, prodded by Ms. Lagarde, who made the restructuring a condition for the International Monetary Fund to participate in the latest bailout for Greece. The advice initially drew sharp criticism from her old colleagues-including from Christian Noyer, then France’s central-bank governor-but authorities ultimately heeded the counsel.

Fang Xinghai, the vice-chairman of China’s securities regulator, said at the same panel that “in terms of communication, we should do a better job”.