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--German Support For De Guindos, Centeno Seen Aiming For Tactical Support
By Christian Vits
FRANKFURT (MNI) - Bundesbank President Jens Weidmann may be in a better
position to succeed Mario Draghi at the helm of the European Central Bank after
Germany supported Spain's Finance minister as the bank's new Vice President, a
well-placed German government source told MNI.
"After [Luis] De Guindos is installed as [Vitor] Constancio's replacement,
Weidmann's chances [for the ECB Presidency] have certainly not worsened," the
A senior Eurosystem source told MNI that the German endorsement for De
Guindos and also Mario Centeno, the Portuguese new head of the Eurogroup, were
"clearly aimed to field Weidmann and facilitate his candidacy" for Draghi's
It is unusual for Germany to have endorsed two candidates from the Iberian
Peninsula to such powerful macroeconomic roles, so the support is seen as a
tactical move to gain the ECB presidency in exchange.
Weidmann, the Governing Council's most prominent hawk, cannot be assured of
ascending to Europe's economic top post "even as we now have a Spanish Vice
President at the ECB, given the negative attitude" in many Southern European
countries towards the likely German candidate, the Eurosystem source stressed.
However, "even if looks like a contentual revolution if Weidmann follows
Draghi, the outcome will be less dramatic than many people think," the source
"His contributions to the discussions in the Governing Council are by no
means confrontational, even as he clearly makes his point and emphasizes his
The source observed that Weidmann "is very, very flexible. He is not the
guy who is overly dogmatic when assuming a new role." In the past, "he always
quickly adapted to the prevailing conditions."
French central bank Governor Francois Villeroy de Galhau, seen as a main
contender for Weidmann, might face German resistance if he decides to apply for
But at the time when Villeroy did kind of a roadshow at many events in
Germany, the source was told "that [Chancellor Angela] Merkel approached him and
said he should stop it as the German-French relations wouldn't foresee a chance
"Very much would have to go wrong from a German viewpoint that a compromise
candidate such as Villeroy would get on the agenda," the source added.
In another exclusive interview with MNI, former ECB Chief Economist Juergen
Stark reminded of German mistakes in the past.
Berlin backed Portugal's Vitor Constancio for the ECB Vice Presidency to
boost the chances of a Northern European candidate getting the top job: Axel
But in the end, Weber threw in the towel,leaving Mario Draghi to take the
helm, forming South-South partnership with Constancio in the ECB's top
"It was a mistake of the German government to lead this North-South card,"
Stark noted. "And it is not true that always the North-South idea was followed,
think of [Wim] Duisenberg and [Christian] Noyer at the start of the currency
The German government source also indicated that the issue was discussed in
the German grand coalition exploratory talks to ensure social democratic party
support for Weidmann at home. And, as before, his candidacy is still high on the
agenda for the new Berlin government, the source confirmed.
At the end of the day, it will be political backing that counts, the source
added. "While the Governing Council's opinion will play an important role, it is
not the decisive body. I doubt De Guindos would get a majority in the Council,
but he will become Vice President."
--MNI London Bureau; tel: +44 203-586-2225; email: firstname.lastname@example.org