A POLICE INQUIRY AND 12 REASONS TO DOUBT THE QUEEN OF THE IMF
Christine Lagarde yesterday painted a doomsday picture of the consequences of Britain leaving the european Union. But an examination of her career at the international Monetary Fund suggests why her warning cannot be taken seriously.
1 THE EURO
The IMF is widely credited with saving the euro from collapse in the troubled years from 2009 to 2012. The fund was called in to help rescue the debt-laden governments of Ireland, Portugal, Greece and Spain. But Lagarde, who had replaced the disgraced Dominique Strauss-Kahn in 2011, was criticised for exceeding her mandate when she appeared beside eurozone officials to announce details of the rescue efforts.
2 SUSPECT PAYMENTS
In December a French court charged Lagarde with negligence over her role in an alleged illegal payment of £317million to the tycoon Bernard Tapie. The case has still to be heard. Her Paris apartment had been raided by police in 2013.
3 GREEK NIGHTMARE
The IMF has failed to resolve the Greek crisis despite six years of intensive involvement. It is now at loggerheads with Germany over a proposal to write off some of Greece’s debt.
4 TAX-FREE PAY
Lagarde has accused Greeks of not paying their taxes, yet her annual salary of £326,000 is free of tax.
5OSBORNE’S CHUM
Lagarde and Chancellor George Osborne, who is campaigning for Remain, have become close friends and regular dining companions. She makes a point of personally presenting the IMF’s report on the UK economy. Such presentations are usually left to lower-ranking officials.
6OLD PALS’ ACT
Last May Mr Osborne persuaded the IMF to postpone its inspection of the UK until September so as not to get in the way of the politics around the general election. 7OLD PALS’ ACT 2 Yet this year’s IMF report on the UK will be issued a week before Britain votes in the EU referendum. With the exception of election years the IMF’s analysis has not been released until July at any time since 2008.
8WRONG ON UK PLC
Mr Osborne and the IMF have not always seen eye to eye over economic policy. In April 2013 the fund’s chief economist accused the Chancellor of ‘playing with fire’ with his plans to cut the deficit and debt with an austerity programme.
9WRONG AGAIN
The fund’s warning proved hopelessly wrong and Britain became the fastest growing economy among the G7 richest Western countries in 2014 and 2015.
10DODGY FORECAST
The IMF’s claim that Brexit could lead to a loss of national output of between 1.5 per cent and 9.5 per cent ranks among the vaguest and therefore least credible forecasts it has ever adopted.
11 CRUSHING SAVERS
The IMF has been backing negative interest rates that would hammer savers. The policy has also been blamed for keeping economies in the doldrums.
12 EU BRAVADO
Despite Europe’s multitude of problems ranging from public debt to the migrant crisis, Lagarde last year told a sceptical interviewer the EU project was ‘stronger than ever’.