Read news from:
Austria
SHARE
COPY LINK

IMF

IMF chief Lagarde to face trial over €400m payout

IMF chief Christine Lagarde will face trial on a charge of negligence over a whopping €4.3 million payout to tycoon Bernard Tapie.

Published: 17 December 2015 16:34 CET
IMF chief Lagarde to face trial over €400m payout

International Monetary Fund (IMF) chief Christine Lagarde has been sent to trial over her handling of a massive state payout to French tycoon Bernard Tapie during her time as finance minister, a legal source said Thursday.

Lagarde had been charged with negligence in the case in which Tapie was awarded more than €400 million ($433 million) in a 2008 dispute with the Credit Lyonnais bank over the sale of sportswear giant Adidas in 1993.

Tapie was ordered to pay back the money at the beginning of this month.

A statement from the IMF said Lagarde would fight the trial order and that the organisation had confidence in her.

The International Monetary Fund's executive board, representing 188 member nations, “continues to express its confidence in the managing director's ability to effectively carry out her duties,” IMF spokesman Gerry Rice said in a statement.

Lagarde, who has headed the IMF since July 2011, was charged with negligence in the handling of the 2008 government payout to French tycoon Bernard Tapie during her tenure as finance minister.

Tapie was awarded more than 400 million euros ($433 million) in a 2008 dispute with the bank Credit Lyonnais over the sale of sportswear giant Adidas in 1993.

Since the opening of a French investigation into the handling of the Tapie case in August 2011, the IMF has steadfastly reaffirmed its confidence in Lagarde, whose mandate expires next July and who recently has said she is open to serving a second five-year term.

“The board will continue to be briefed on this matter,” Rice said.

 

ECONOMY

Italy’s economic policies will hit the poor hardest: IMF

Economic policies implemented by the populist government in Rome leave Italy's economy vulnerable to recession, with the poorest likely to suffer the most, the IMF warned.

Published: 7 February 2019 09:45 CET
Italy's economic policies will hit the poor hardest: IMF
Italy's economic policies could lead to recession, the IMF said. Photo: Andreas Solaro/AFP

“The authorities' policies could leave Italy vulnerable to a renewed loss of market confidence,” an International Monetary Fund annual report on the country said yesterday.

“Italy could then be forced into a notable fiscal contraction, pushing a weakening economy into a recession. The burden would fall disproportionately on the vulnerable,” the IMF added.

The Italian economy, the eurozone's third largest, fell into a technical recession at the end of 2018.

The fund expects the Italian economy to grow by no more than 0.6 percent this year, well below the government's own estimate of 1.0 percent.

The European Commission is tipped to lower its Italian growth forecast on Thursday, and slower growth could spell trouble for Italy, where around 20 percent of national output is swallowed up each year by payments on the public debt, the second biggest in the eurozone.

Photo: Depositphotos

The IMF report praised the coalition government's “objective to improve economic and social outcomes (as) welcome.”

But it added that the only sustainable way of achieving such goals was through “faster potential growth” that would require structural reforms, “a credible fiscal consolidation” and stronger bank balance sheets.

The coalition government of the anti-establishment Five Star Movement (M5S) and the far-right League party was forced to water down its ambitious and costly budget in December to avoid being punished by the EU Commission and financial markets.

The IMF report emphasised Wednesday that Italy “needs to tackle long-standing structural impediments to productivity growth. 

“This includes decentralising the wage bargaining regime, liberalising service markets, and improving the business climate.”

Deputy Prime Minister and M5S leader Luigi Di Maio quickly rejected the IMF report, charging that the Fund “has starved people for decades.”

The IMF, Di Maio claimed, “has no credibility to criticise a measure like the citizenship income programme,” the party's plan to introduce a welfare payment of 780 euros a month for Itay's least well-off.

READ ALSO: