Christine Lagarde's mission to save the global economy

Katty Kay
Presenter, BBC World News
@KattyKayBBCon Twitter

Media caption, IMF boss Christine Lagarde discusses her campaign to save the global economy with the BBC's Katty Kay

Over the past month the BBC has had rare access to International Monetary Fund boss Christine Lagarde. Now, as European leaders meet in Brussels, she will be at the centre of the fight to avert another financial crisis.

The Japanese finance minister checks his watch and smooths his already immaculate hair. Jun Azumi is a little nervous.

In a cramped Mexico City office, he's waiting for a photo call with Christine Lagarde, the 6ft tall, impeccably elegant managing director of the International Monetary Fund who is as close as it gets to a megastar in the world of finance.

For the past month Ms Lagarde has given the BBC unusual behind-the-scenes access as she steers her 187-member organisation to manage the biggest financial crisis of our lifetimes - the fiscal nightmare that is the eurozone.

I first caught up with her on a cold January morning in Washington DC as she walked to work. Yes, Ms Lagarde has always been a little unconventional, and ditching the world-leader-limo in favour a brisk stroll fits the pattern. Besides, she needs all the physical activity she can get.

"Normally I walk a lot faster," she chides. "I work so hard and so long hours that I don't have time to exercise."

She has a way of getting people to do what she wants. I promise to pick up the pace.

Passing the cap

Christine Lagarde first came to Washington to work as an intern on Capitol Hill during the Watergate scandal. Now she's back in a very different role, with a mission to protect the world from the fallout of the euro crisis.

"All economies of the world are likely to be affected by what is happening in one key region of the world. Much more so than, say, at the time of the Latin American crisis or the Asian crisis," she insists.

Her conviction that the euro crisis leaves no country immune is what is driving Ms Lagarde to ask the world to help pay for a $500bn (£314bn) global firewall. It is a job that keeps her extremely busy and extremely mobile.

Last Friday, as we walked together through Dulles airport near Washington, I asked her how many flights she has taken this year. Of all our encounters, this was one of the few times she could not think of an answer.

Luckily a couple of French fans call out gaily in greeting and Ms Lagarde is saved from the airplane maths exam.

On that travel occasion she was on her way to Mexico City for a meeting of the G20 Finance Ministers and she invited us to join her.

This summit is a chance to pass around the IMF cap for those hundreds of billions of dollars. She uses all her easy charm and lawyer's training to cajole non-eurozone countries to surrender their domestic interests to the greater global good.

The trouble is countries like the US, China and the increasingly confident emerging economies don't see why they should pay more until Europe does more to help itself.

"Until we see the colour of the eurozone money we're not prepared to put our own money in," Britain's Chancellor of the Exchequer, George Osborne, tells me.

'No longer French'

That is an argument you hear, too, from countries that have themselves received IMF bailouts in the past. In 1994 the Mexican peso crisis sent panic through the region and the IMF stepped in with a $17bn (£10.7bn) loan.

Image caption, British Chancellor George Osborne is an old friend, but won't promise cash quite yet

But Mexican economists complain that the conditions for their loan were far stricter than Europe's and it leaves them wondering: Is the IMF too soft on the eurozone?

"We should have equal treatment," says economist Luis De La Calle. "There's always the perception that the IMF is a European institution and the fact that Lagarde is a former French foreign minister is all the more reason for her to be tough on Europe."

If Christine Lagarde ever bristles, it is in rejection of just that criticism. She says she would like to meet Mr De La Calle and set him right. "I feel very much managing director of the IMF. I'm no longer French and I'm no longer European."

In some respects her close European ties are an advantage. The euro crisis is about politics as much as it about economics and Ms Lagarde's good relationship with German Chancellor Angela Merkel is critical in trying to get Germany to move faster to increase Europe's own firewall.

Is she frustrated then that Mrs Merkel isn't doing more?

"It's a matter of patience, it's a matter of resilience, and I'm not going to give up", she says. "[Merkel] does not want to be rushed into a process unless she has covered all the angles and all the issues. I think it is one of her many, many talents."

It is exactly the way Ms Lagarde herself operates.

Female factor

Look at the group photos from the endless European summits and it is not lost on anyone that two of the most important figures are women, operating in a largely male world.

Image source, Getty Images
Image caption, Angela Merkel and Christine Lagarde met earlier this year in Germany

Ms Lagarde wishes there were more. She says she firmly believes that if it had been Lehman Sisters instead of Lehman Brothers, the financial crash might never have happened. But then perhaps, she wouldn't have taken the job she did, and we wouldn't have the first female head of the IMF.

The last time we meet, Christine Lagarde says Europe is now at least moving in the right direction. But there are caveats.

The woman who says she wakes up every morning wondering "where is it going to crack," is naturally cautious. Too much can still go wrong.

"I don't think we're out of the woods yet. Let's put it that way."

Ms Lagarde has not yet got firm commitments for her global fund. This week she is on the road again, back in Brussels, trying to persuade European leaders they have to help themselves before asking for more help from others.