Wednesday 24 May 2017

ECB's Draghi puts Belgian in charge of brief sought by Germany

central banks

Rainer Buergin

European Central Bank president Mario Draghi has agreed to put Belgium's Peter Praet in charge of the bank's economics division, ignoring calls from Germany that one of its nationals should keep the job.

The appointment will give Mr Praet ultimate oversight over the bailout of Ireland, since the head of our bailout mission, Klaus Masuch, will report to the newcomer. Mr Praet is also likely to be the most senior ECB official to give interviews about Ireland's bailout, as his predecessor Juergen Stark did on several occasions.

Mr Praet (62) will be the first non-German to hold the role since the ECB was founded in 1998 and was a specialist in financial regulation at the Belgian central bank before joining the ECB's executive board in June.

Germany's Joerg Asmussen will be responsible for international relations. France's Benoit Coeure, another candidate for the economics job, will be in charge of market operations from March.

Shrewd

Mr Draghi's move sidesteps the political question of whether former finance ministry officials from either Berlin or Paris should mould the ECB's economic analysis as policymakers are scrambling to end the debt crisis.

German Finance Minister Wolfgang Schaeuble had said that Mr Asmussen would be the "best person" to succeed Juergen Stark, who resigned last year to protest the central bank's bond purchases.

"The ECB has found a pretty good solution to bypass possible national disputes," said Sebastian Wanke, an economist at Dekabank in Frankfurt.

Mr Coeure and Mr Asmussen will nevertheless be at the centre of policy making.

Mr Asmussen will represent the ECB at crisis meetings of euro-region finance officials in Brussels. As head of markets, Mr Coeure takes charge of the refinancing operations that have become the central toolkit in the ECB's efforts to fight the debt crisis. (Bloomberg)

Irish Independent

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