10 June 2020

EPC: Eurogroup: Centeno’s successor should be a Commissioner

Following Centeno’s resignation, Andrew Duff argues for breaking with precedent and appointing a senior member of the European Commission as president of the Eurogroup.Both the legal status and political efficacy of the Eurogroup have been questioned in recent times. Rightly so.

The Eurogroup is not a formal decision-making institution of the Union but it has influence, and in times of (almost perpetual) financial crisis it has shaped policy. What it is not is a reliable substitute for economic government because it lacks the tool of fiscal policy. The Eurogroup is also democratically unaccountable.

Nevertheless, nobody can doubt the need for the finance ministers of the eurozone countries to meet together regularly in a relatively discreet and informal setting. Its chair must have a very close relationship with the EU Commission whose job it is to try to coordinate the economic policies of the member states. The Eurogroup president needs diplomatic skills and deserves to be well-resourced in terms of institutional back-up, ideally of a supranational and not a national bias.

Mario Centeno’s resignation opens up a contest for his succession. Already names of national finance ministers are being canvassed. However, another solution presents itself - namely, to break with precedent and appoint a senior member of the European Commission to chair its meetings.

As the EU moves closer to accepting the need for a common fiscal policy to boost economic recovery from the coronavirus pandemic, the position of the Commission becomes central. The proposed economic recovery fund, financed by the issuance of eurobonds, creates the nucleus of a proper EU treasury up and above the previous funds, such as the European Stability Mechanism, which rest on an intergovernmental basis. A treasure needs a treasury secretary. That person at present is Paolo Gentiloni. He would be an admirable chair of the Eurogroup.

Protocol No 14 of the Lisbon Treaty does not prohibit the election of a Commissioner as Eurogroup chair. Mr Gentiloni needs 10 of the 19 ministers to vote for him. Nominations close on 9 July.

EPC

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