European Parliament Approves Lagarde As Next ECB Chief

Members of European Parliament take part in a voting session on the appointment of the new European Central Bank (ECB) President candidate and outgoing International Monetary Fund (IMF) chairwoman Christine Lagarde at the European Parliament in Strasbourg, eastern France, on September 17, 2019. FREDERICK FLORIN / AFP

 

The European Parliament on Tuesday approved outgoing IMF chief Christine Lagarde as the next boss of the European Central Bank, which last week announced massive stimulus for the sluggish eurozone despite divisions among its governors.

Lagarde, who was absent for the vote, won backing from 394 MEPs, with 206 voting against and 49 abstaining in a secret ballot. Some criticised her not turning up.

The parliament’s green light is just a recommendation. The final decision on her appointment is up to EU leaders in a mid-October summit. She is expected to easily clinch that confirmation as the leaders put her forward for the ECB post back in July.

Lagarde, a former French economy minister and head of the International Monetary Fund for the past eight years, is expected to largely follow the course set by departing ECB president Mario Draghi.

Draghi was hailed seven years ago for saving the eurozone from debilitating crisis by vowing “the ECB is ready to do whatever it takes”.

But his decision last Thursday to have the ECB intervene again with quantative easing (QE) from November and a cut to the interest paid on banks’ deposits deeper into negative territory has ruffled the feathers of some EU states.

Germany and the Netherlands notably accused Draghi of going too far. Sources told AFP that around 10 of the 25 ECB governors were against relaunching QE.

Draghi had underlined three challenges facing the ECB and its goal of price stability: a slowing eurozone economy, looming trade protectionism and Brexit, and the bank’s degrading economic forecasts.

He is to leave his job to Lagarde after hosting a last monetary policy meeting in October.

The euro, a symbol of Europe’s single market, is used by 19 of 28 member states currently in the European Union.

AFP

Removing Fuel Subsidies Is The Right Way To Go, IMF Tells Nigeria

The Managing Director, IMF, Christine Lagarde at a press conference on Thursday, during the on-going joint annual spring meetings with the World Bank in Washington DC.

 

The International Monetary Funds (IMF) has asked the Nigerian Government to consider the complete removal of fuel subsidy.

IMF Managing Director, Christine Lagarde, who said this at a press conference on Thursday, noted that it was the right way to go.

Addressing a joint annual spring meeting of the World Bank in Washington DC, United State, she explained that the move would save a lot fiscally and in terms of human lives.

“We believe that removing fossil fuel subsidies is the right way to go,” Lagarde affirmed.

She added, “If that was to happen, then there would be more public spending available to build hospitals, to build roads, to build schools, and to support education and health for the people.”

READ ALSO: IMF, World Bank Urge Caution With China Loans

The IMF boss revealed that the figures spent on subsidy from 2015 were staggering.

She, however, urged the government to put in place a social protection safety net while the subsidy was being removed, to reduce its effect on the people.

“If you look at our numbers from 2015, it is no less than about $5.2 trillion that is spent on fuel subsidies and the consequences thereof,” she said.

Lagarde added, “And the Fiscal Affairs Department has actually identified; you know how much would have been saved fiscally but also in terms of human life if there had been the right price on carbon emission as of 2015. The numbers are quite staggering.

“Now, how this is done is more complicated because there has to be a social protection safety net that is in place so that the most exposed in the population do not take the brunt of the removal of subsidies principle. So that is the position we take.”

According to the IMF boss, with the low revenue mobilisation that exists in Nigeria in terms of tax-to-GDP, the nation is amongst the lowest.

She said there was a need for “a real effort” to maintain a good public finance situation for the country and in order to direct investment towards health, education, and infrastructure.

The IMF had in a recent ‘Staff Article IV consultation report on Nigeria’ made recommendations that the fuel subsidy should be removed.

Brexit: IMF Warns Britain’s Economy Would Suffer ‘Substantial Costs’

International Monetary Fund (IMF) managing director Christine Lagarde speaks at a press conference to mark the publication of 2018, Britain’s economy would suffer “substantial costs” should it leave the European Union in March with no divorce agreement, the International Monetary Fund warned Monday. John Stillwell / POOL / AFP

 

 

 

Britain’s economy would suffer “substantial costs” should it leave the European Union in March with no divorce agreement, the International Monetary Fund warned Monday.

Brussels and London have failed to resolve “fundamental” aspects of Brexit and this could leave London defaulting to World Trade Organisation (WTO) tariffs, the IMF said in its annual outlook on the UK economy.

“Fundamental questions — such as the future economic relationship between the two and the closely-related question of the status of the land border with Ireland — remain unanswered,” the institution noted in a statement.

“Resolving these questions is critical to avoid a ‘no-deal’ Brexit on WTO terms that would entail substantial costs for the UK economy — and to a lesser extent the EU economies — particularly if it were to occur in a disorderly fashion,” the IMF added.

The gloomy assessment contrasts with that of British Prime Minister Theresa May, who indicated last week that a no-deal Brexit would not be a disaster for Britain.

May remains confident of striking an acceptable deal with Brussels meanwhile.

The IMF forecast Monday that the British economy would grow by 1.5 percent in 2019, unchanged from its previous estimate.

However, the prediction is based on Britain sealing an EU divorce deal and transition period by the end of the year.

AFP

French Court Convicts IMF Chief, Christine Lagarde 

French Court Convicts IMF Chief, Christine Lagarde A French court has found International Monetary Fund Chief, Christine Lagarde, guilty of negligence in approving a massive payout of taxpayers’ money to controversial French businessman, Bernard Tapie.

In 2008, as French Finance Minister, she approved an award of 404 million Euros to Mr Tapie for the disputed sale of a firm.

The French court convicted the head of the International Monetary Fund and former government minister, who had faced a 15,000 Euros fine and up to a year in jail.

The court, however, decided Lagarde should not be punished and that the conviction would not constitute a criminal record.

Accused of allowing the misuse of public funds, rather than actual corruption, she could potentially have been sentenced to a year in prison.

The IMF in a statement says it will meet to consider the latest developments in France.

French Female Ministers Rise Against Sexual Harassment

Sexual Harassment, French Ministers, Female MinistersSeventeen women who have served as ministers in France have signed a declaration against sexual harassment in politics, saying they will no longer be silent about the issue.

Among the 17 signatories to the declaration, who are current or former ministers, is the head of the International Monetary Fund and France’s former Finance Minister, Christine Lagarde.

The declarations read, “Like all women who have entered spheres that up until then were exclusively male, we have had to fight against sexism.

“It is not for women to have to adapt to these places, but for the behaviour of certain men to change.”

The women further said in the declaration, “We encourage all victims of sexual harassment and sexual assault to talk and complain. We ask our parties and our political groups to verify if such acts were committed and if that was the case, to help the victims to get to the truth.”

Last week, the Deputy Speaker of the National Assembly, Denis Baupin, resigned over sexual harassment claims, which he denies.

Examples of some of the sexual harassment suffered by the women are also given in the article.

It explains that Fleur Pellerin, who was Culture Minister in Francois Hollande’s government from 2014 until this February 2016, rarely suffered harassment until she was appointed to office.

After her first appointment in government, she was asked by a male journalist if she was given the job because she is a beautiful woman.

IMF Boss Calls For Removal Of Subsidy, Review Of Tax Regime

lagardeThe Managing Director of the International Monetary Fund (IMF) Christine Lagarde on Wednesday met with leaders of the National Assembly and called for the removal of fuel subsidy.

Speaking during a meeting with some lawmakers from both the lower and upper legislative chambers, she also called for a review of Nigeria’s tax regime.

Although the lawmakers are currently on recess, the Senate President, Bukola Saraki and some lawmakers from the two Chambers of the National Assembly were on ground to receive the IMF boss.

The Chairmen of the Senate Committee on Finance, Senator John Eno and that of Appropriation, Senator Danjuma Goje were also at the meeting.

The Senate President told the IMF boss that Nigeria is experiencing challenging times due to low oil prices and insurgency in the Northeast.

He, however, said Nigeria is resilient and would surmount these challenges.

Senator Saraki further noted that the National Assembly has a key role to play in ensuring that the government’s policies are sustainable.

In another meeting with the Central Bank Governor, Ms Largade called for increased funding for the nation’s real sector.

The former French finance minister, who spoke with journalists after the meeting expressed optimism that increased funding of the critical sectors of the economy, such as agriculture and the Small and Medium Enterprise, remain key to the nation’s development.

She expressed confidence in the Nigerian economy but says she expects more stability in the system.

“Nigeria faces some tough choices going forward. Nigerians, however, are well known for their resilience and strong belief in their ability to improve their nation and lead others by example.

“I firmly believe that Nigeria will rise to the challenge and make the decisions that will propel the country to greater prosperity”, she said.

The Central Bank Governor promised to fashion out modalities in getting the commercial banks to work in that direction.

Donates To Motherless Babies

Ms Lagarde also visited the Mother Theresa Orphanage in Gwarinpa Area of the Nation’s capital and advised the government to invest in its younger generation.

The IMF boss donated N1.5 million to the orphanage to improve the lives of the children.

Government Should Create Room For Private Investment – Economist

ayo teriba on private investmentThe CEO of Economic Associate has opined that the Nigerian government should create more room for private investment than borrowing to fund contractors.

Speaking on Channels Television’s Sunrise Daily on Wednesday, Mr Ayo Teriba said that “every contractor is a potential investor with the right incentive. Private investors can go and borrow money to do projects on behalf of the government or with the government.

“I have a strong reservation about the plan to borrow two Trillion Naira in 2016. The government should look for investors not debtors”, he said.

Mr Teriba further stated that leaving investors completely out of the budget is a wrong step.

“The world highly esteems Nigeria and the new government,which is an evidence of the visit of the International Monetary Fund (IMF) boss, Christine Lagarde and the duration of the visit.

“But it is not only the IMF that esteems Nigeria and opportunities in Nigeria, investors do”, he said.

Talking about his reservations about the 2016 budget and the visit of Lagarde, the Economic Associate boss said that “it is good that the President (Muhammadu Buhari), last month, announced his policy directions and also announced his plans/budget for the current year. It is a welcome development that has been commended.

“The visit of the IMF boss is also commendable. It is now, we have a clear direction where the economy is heading and more details about the fiscal situation and where I might say I have residual reservation. I must emphasise that I fully agree with the broad direction of the government and my reservation is about how we want to fund some of them”, he said.

Giving his opinion about a statement made by the IMF boss on not interfering with the budget, Mr Teriba said that” IMF doesn’t get involved until a country has debt service difficulty.

“If we allow the debt to grow with the current low revenue situation and you get into a situation where you cannot honour your external debt obligations, you won’t find IMF smiling at you”, he added.

Government Should Patronise Local Investors – Policy Analyst

bolaji ogunseye on local investorsA Nigerian policy analyst has advised the government to patronise local investors in order to boost the economy.

Speaking on Channels Television’s Sunrise Daily on Tuesday, Mr Bolaji Ogunseye, said that “I think the government should look for mechanisms by which you give a push to local investors.

“The word local investors doesn’t mean poor investors – there are solid high-led worth local investors. You look at the various layers- from the bottom to the top; exploitation and production, value addition to raw materials among others in considering them”, he said.

Talking about his expectation of the visit of the Managing Director of the International Monetary Fund (IMF), Christine Lagarde, the analyst said that “it’s interesting that a visit by an IMF Chief has almost become a central talking point in the whole country.

“My attitude is what is the development economics thinking; the logic behind it?

“Having that as the ongoing narrative for the Nigerian economy, its far more important than one visit by the head of one specialise agency”.

Mr Ogunseye further said that “I’m not coming from a position that IMF is bad, a lot of the things that IMF may want to talk about – macro policy, monetary policy, and fiscal policy among others are quite frankly common sense things, if you are running your economy well”.

While giving his opinion about the benefits of the devaluation of the Naira in relation to the Structural Adjustment Programme (SAP), Mr Ogunseye said that “if you must devalue the Naira, it has a direct knock-on effect on inflation” and “inflation comes with devaluation.

Answering a question on how the government plans to remove all import restriction, the policy analyst said that “the IMF is not a global supervisor of government.

“My advice to this government is that I think we should not put all our hopes for the structural correction of the Nigerian economy on one out of four budgets.

“We need to produce more goods in the country and the government should make itself less of an obstructionist to those who want to produce.

“We should integrate, solidly, our economy with that of other West African countries”, he advised.

The Managing Director of the IMF arrived Nigeria for a four-day official visit during which she will meet President Muhammadu Buhari.

The meeting is expected to help strengthen the IMF’s partnership with the largest economy in Africa and to discuss how to address Nigeria’s economic challenges and the impact of low oil prices.

IMF’s Lagarde Arrives Nigeria For Economic Talks

ImfThe Managing Director of the International Monetary Fund (IMF), Christine Lagarde, has arrived Nigeria for a four-day official visit during which she will meet President Muhammadu Buhari.

The meeting is expected to help strengthen the IMF’s partnership with the largest economy in Africa and to discuss how to address Nigeria’s economic challenges and the impact of low oil prices.

According to a statement by the IMF, “Mrs Lagarde believes that Nigeria is working hard to improve its business environment, promote opportunities for growth in the private sector and strengthen social cohesion and all areas where government has an important role to play.”

The IMF Managing Director, who arrived in Abuja at about 3:00PM, was received by the Minister of Finance, Mrs Kemi Adeosun; the Governor of Central Bank, Mr Godwin Emefiele and staff of the IMF at the Presidential Wing of the Nnamdi Azikwe International Airport, Abuja.

Mrs Legarde is expected to also meet with principal officers of the National Assembly, business leaders, prominent women and representatives of Civil Society Organisations.

Eurozone countries donate $34 billion to IMF

IMF director Christine Lagarde has welcomed pledges from Switzerland, Poland and other countries to provide some $34 billion in additional funding for the world lender.

Lagarde, in separate statements late Wednesday, singled out Switzerland and Poland for increasing their contributions, hailing their “enduring support for the spirit of multilateralism.”

“Ensuring the Fund has sufficient resources to tackle crises and to promote global economic stability is in the interests of all our members,” she said.

The IMF statement said “Switzerland and other countries” had pledged $26 billion of increased funding while Poland had agreed to provide $8 billion.

“This brings to about $320 billion the commitments received so far. I am, (of) course, very encouraged by this strong demonstration of support for the Fund, and I look forward to further commitments from our broader membership.”

In a Frankfurt Allgemeine Zeitung interview published this week, Lagarde revealed that the International Monetary Fund is seeking some $400 billion for expanding its crisis intervention “firepower.”

That was sharply lower than the original target of $500 billion. Last week Lagarde said the Fund was lowering its target, citing a slight easing of financial tensions, both globally and in the eurozone.

The pledges from Switzerland are in addition to previous pledges for increased contributions from the Euro Area of €150 billion (about US$200 billion); Japan of US$60 billion; Sweden of at least US$10 billion; Norway of SDR 6 billion (about US$9.3 billion); Poland of €6.27 billion (about US$8 billion); and Denmark’s Nationalbank of €5.3 billion (about US$7.0 billion), and Japan, which pledged $60 billion.

 

IMF Head Christine Lagarde Visits Nigeria, Praises President Jonanthan’s Economic Plan

Christine Lagarde visits Nigeria

President Goodluck Jonathan said Monday in Abuja that his Administration remains totally committed to engineering a positive transformation of the Nigerian economy that will ensure that the country becomes a much bigger player in the global economy as envisioned in its Vision 20:2020.

Speaking at a meeting with the Managing Director of the International Monetary Fund (IMF), Ms. Christine Lagarde, President Jonathan said that the team established to oversee the implementation of the administration’s economic agenda will receive all the political support it requires to ensure that the objective of significantly improving the national economy is attained.

“We are totally committed to changing things in Nigeria. Our vision is that by the year 2020, Nigeria will have become a much bigger player in the global economy.

We have established a good team and we will give them the full political backing they need to succeed,” the President said.

Noting that Nigerians had become wary and skeptical of dealings with the IMF in the aftermath of the Structural Adjustment Programme (SAP), President Jonathan said that he believed that the IMF was now a changed institution which could contribute positively to the economies of Nigeria and other developing nations.

“I believe the present IMF is different. Our emphasis is on poverty alleviation and job creation. We are also looking at ways of improving education and health-care delivery.

I believe we can work together constructively,” he said.

Reviewing international developments with Ms. Lagarde, President Jonathan said that he believed that the IMF had a key role to play in resolving the ongoing crises in the global economy, noting that events in the developed economies were bound to affect developing countries.

Ms. Lagarde commended President Jonathan’s Agenda for National Transformation and the actions being taken by his Administration to ensure its effective implementation.

She informed the President that the feedback she had received from the IMF team which recently undertook a review of the Federal Government’s economic programme was “very positive”.

The IMF Managing Director said that the IMF team had been very impressed with the Government’s prioritization of job creation, agriculture, power supply, education and health-care.

Ms. Lagarde said that the team was also impressed with the Jonathan Administration’s fiscal and monetary policies as well as the reformation of the banking and financial services sector, and the establishment of a Sovereign Wealth Fund.

She advised, however, that the Government should take further steps to protect Nigeria from the adverse effects of the crises in the global economy.