Change Edition

Gramegna loses out to Centeno on Eurogroup

Gramegna loses out to Centeno on Eurogroup

by Alistair Holloway, Heledd Pritchard 3 min. 04.12.2017 From our online archive
Luxembourg finance minister, Pierre Gramegna, made it to top two to replace Dijsselbloem
Luxembourg Finance Minister Pierre Gramegna (LW)

Luxembourg's finance minister, Pierre Gramegna, has lost out to Portugal's Mario Centeno in the race to head the Eurogroup.

Four finance ministers were in the running for the position – Centeno, Gramegna, Slovakia's Peter Kazimir and Latvia's Dana Reizniece-Ozola.

The Eurogroup is an informal body of ministers from the 19 countries using the euro that discusses matters relating to the common currency.

In the first round of voting earlier today, none of the candidates reached a simple majority of 10 votes, and Latvia's Reizniece-Ozola dropped out of the race.

The last two ministers in the race to head the group were Gramegna and Centeno.

Before the vote, current president Jeroen Dijsselbloem seemed to have let slip that Centeno would be his successor.

Mario Centeno (AFP)
Mario Centeno (AFP)

While talking to reporters before the meeting, Dijsselbloem said: "I'll be president until January 12, and Mario Centeno will take office on January 13."

He then backtracked, saying he "of course" did not know, adding "please do not quote me". 

Speaking to reporters outside the European Council earlier on Monday, Gramegna said he was expecting to "fare well" in the first round.

"I entered the race because I thought I had a chance to win the race," he said. "I'm reasonably optimistic."

Centeno will replace former Dutch finance minister Dijsselbloem, who became Eurogroup president in 2013 and was re-elected in 2015. He steps down in January.

The president is responsible for chairing Eurogroup meetings, drawing up the Eurogroup's long-term work programme and presenting the outcomes of discussions to the public and to ministers of non-euro area EU countries.

To become president, contenders have to secure a simple majority of at least 10 backers at the meeting in Brussels.

If no candidate reaches that point, each of the ministers running will be told how many people backed them.

They then have the opportunity to withdraw, and voting continues.

"The chairmanship of the Eurogroup is not about pushing national interests but to find the compromises that are acceptable to all with the right timing and sequencing," Gramegna said in his application letter.

The Luxembourg Times has seen all four applications.

Slovakia's Peter Kazimir, Luxembourg's Pierre Gramegna, Latvia's Dana Reizniece-Ozola and Portugal Finance Minister Mario Centeno (AFP)
Slovakia's Peter Kazimir, Luxembourg's Pierre Gramegna, Latvia's Dana Reizniece-Ozola and Portugal Finance Minister Mario Centeno (AFP)

Centeno said the Eurogroup should "promote the implementation of a fully credible fiscal surveillance framework and of more robust policy coordination mechanisms", according to his application.

Gramegna, a member of the Democratic Party, became Luxembourg's finance minister in December 2013.

During the country's presidency of the European Union in the second half of 2015, he backed the diversification of the country's economy dominated by the finance sector.

Slovakia's Kazimir, in his letter, said the watchword was "reform at home and in the eurozone". 

"The next two and a half years will be of crucial importance," Kazimir said.

"Our role in the Eurogroup is to set the future direction of the euro area, inspire and bring the whole EU closer."

At its meeting, the Eurogroup will also discuss the economic state of Greece, Cyprus and Spain.

All three, along with Ireland, have had to use funding from the European Stability Mechanism (ESM) or its predecessor, the European Financial Stability Facility (EFSF).

The ESM provides financial assistance to any eurozone country that is experiencing or is threatened by severe financing problems.

Its establishment in 2012 was part of the European response to the global financial crisis.

Since 2011, the institution, and the EFSF, has disbursed €273 billion.

That is 2.5 times more than the International Monetary Fund over the same period.

The Eurogroup will also discuss economic growth and the tax burden on workers, both those on the average wage and those on low wages, according to a draft agenda.

It will also talk about eurozone budgets and adopt its work programme for the first half of next year.