Tue, May 17, 2011 - Page 10 News List

Italy’s Mario Draghi set to take over as ECB chief


Mario Draghi of Italy was set to be appointed president of the European Central Bank (ECB) by eurozone finance ministers yesterday, at a pivotal point in the eurozone debt crisis.

The drama at the top of the IMF over the arrest of its director, Dominique Strauss-Kahn, on sex assault charges puts a keen edge on the ECB leadership talks in Brussels even though there was little doubt that Draghi would get the job.

Draghi became the almost certain successor to French Jean-Claude Trichet when German Chancellor Angela Merkel endorsed him last week.

For months German media had reported that Merkel wanted him to take over the IMF instead of the ECB when Strauss-Kahn’s term ends next year.

Draghi, who heads the Italian central bank and is known in Italy as “Super Mario,” had already received the backing of the other key leader in the eurozone, French President Nicolas Sarkozy.

With the ECB spearheading herculean efforts to contain a year-long debt crisis overhanging the euro, observers would like to see a smooth transfer when Trichet steps down in October.

Luxembourg Prime Minister Jean-Claude Juncker, who heads the Eurogroup of finance ministers, also voiced support for Draghi last week and called for a quick decision on the next ECB chief, saying it would “show a great deal of decision-making authority ... in these difficult times.”

In addition to picking the next ECB president, the EU finance ministers meeting yesterday and today must seal a 78 billion euro (US$110 billion) bailout for Portugal and discuss the possibility of new aid to Greece.

EU heads of state and government will make the final decision on the ECB chief at a summit next month.

Draghi is highly regarded in the global financial sector and has earned kudos as head of the Financial Stability Board, an international body tasked with reforming the sector in the wake of the global economic crisis.

A member of the ECB governing council, which makes key decisions on interest rates, the former Goldman Sachs executive will take over at a stormy time for the euro following EU-IMF rescues for Greece, Ireland and now Portugal.

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