Financial Times: Hola Brussels

06 June 2018

Pedro Sánchez, Spain’s unexpected new prime minister, who took power last week after a parliamentary vote toppled the previous government, has put respected European figures into key positions as he seeks to burnish his credentials on the EU stage.

One appointment that caught many by surprise (and won plaudits in Brussels) was his announcement that Nadia Calviño, the European Commission’s director-general for budget, will be swapping Schuman for Madrid.

Ms Calviño is widely seen in Brussels as one of the brightest talents in the EU institutions, having steered work on an avalanche of financial services proposals in the aftermath of the 2008 crash and dealt with difficult negotiations on that trickiest of all EU issues: money.

One EU diplomat said that the appointment won the Sánchez government “instant credibility in Brussels now in terms of differentiation with Italy”.

And, with Italy’s new populist government picking a fight with other EU capitals on the core issues of migration policy and eurozone budget rules, that distinction really matters.

Mr Sánchez, whose bid for power was supported last week by the anti-establishment Podemos party, has quickly moved to reassure Brussels and the financial markets, emphasising that he will stay in line with agreed fiscal limits.

In addition to opting for a well-known Brussels figure in Ms Calviño, he has also chosen Josep Borrell, the 71-year-old former head of the European Parliament, as foreign minister.

People close to his new administration said that, as well as avoiding being bundled in with other southern European nations, Mr Sánchez wants to play a bigger role in Europe than the last government, led by centre-right prime minister Mariano Rajoy.

In particular, he wants to have a strong hand in shaping the EU’s reform agenda. But what kind of Europe does Spain’s new leader want?

Sources close to the new administration say that Mr Sánchez wants to be a strong voice for “ambitious” EU reform, leaning more towards Emmanuel Macron’s far reaching vision of a reinforced euro area with stronger financial firepower than the more conservative stance taken by Mr Rajoy.

Mr Sánchez’s appointment also makes him one of the few centre-left leaders in the EU after the electoral drought suffered by European social democracy in recent years.

While his government is weak, with just 84 lawmakers in the 350-seat parliament, the new prime minister still has a chance to be a leading EU voice for his political family going into the European elections in May next year.

While Mr Sánchez's broad aspirations are clear, the precise details on his government’s positions on key EU reform issues, such as the creation of a eurozone budget, are not. They are set to be defined in the coming days and weeks once the full government takes office. But the pro-European energy will be strongly welcomed in Brussels — particularly after the recent turn of events in Rome. [...]

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