Dominique Strauss-Kahn has been formally named as the new head of the International Monetary Fund (IMF).
The appointment of the former French Socialist finance minister to the helm of the organisation had been widely expected.
The only other nomination for the role was Josef Tosovsky, a former Czech prime minister, who was put up as a late candidate by Russia.
Mr Strauss-Kahn was backed by Europe and the US, which dominate the IMF.
Mr Strauss-Kahn was visiting Chile when the IMF board decision was announced, in a symbolic gesture to show his desire to give emerging economies more of a voice in key decisions at the IMF.
In a statement after the announcement on Friday afternoon, he said: "I am determined to pursue without delay the reforms needed for the IMF to make financial stability serve the international community, while fostering growth and employment."
The 58-year-old who lost out to Segolene Royal to be the Socialist party's candidate in the recent French presidential election will take up the post as IMF managing director for a period of five years on 1 November.
The incumbent, Spain's Rodrigo de Rato, will step down then, cutting short his tenure for personal reasons.
French President Nicolas Sarkozy had supported Mr Strauss-Kahn's leadership bid and hailed the nomination as a "great victory for French diplomacy."
The IMF is a multinational body charged with giving financial aid and assistance to developing countries to secure global financial stability.
But there has been growing criticism over its legitimacy because of the overriding influence of rich nations at the expense of emerging powerhouses, such as India and China.
Since the group's post World War II inception, it has been the custom that Europe picks the boss of the IMF, a practice considered unfair.
Many of the IMF's 185 members are also unhappy with how the board and voting rights are structured.
Mr Strauss-Kahn has pledged to introduce ambitious reforms to the current structure, describing the power-sharing partnership between the US and Europe as "less and less defensible".
The departing IMF boss, Mr de Rato, welcomed the appointment.
"I know he possesses the experience, vision, and dedication to public service needed to successfully lead the IMF at this important juncture," he said.