Close Merkel aide Weidmann next Bundesbank head

16th February 2011, Comments 0 comments

Jens Weidmann, chosen Wednesday to head the German central bank, has been one of Chancellor Angela Merkel's closest aides for almost five years but he is almost unknown to the wider public.

The 42-year-old, youthful looking economist has not risen through the ranks of a political party while building his stellar career but some worry about the effect of his ties to Merkel on the Bundebank's sacrosanct independence.

Weidmann's training includes time at the Bank of France and International Monetary Fund, where he worked on African issues, and he was made a chevalier (knight) of the French Legion of Honour in 2009.

He became Merkel's close adviser on economic affairs in 2006 and has been an influential Group of Eight nations "Sherpa," playing a key role in clinching global agreements.

The German daily Die Welt has called him: "He who whispers in the chancellor's ear."

Weidmann replaces Bundesbank president Axel Weber, who decided to step down at the end of April, casting doubt over who would become the next European Central Bank president, a role many thought Weber would take on.

The young economist will assume Weber's seat on the ECB governing council and will be expected to defend German priorities such as strict control of eurozone inflation.

Weidmann has also made a name for himself as secretary of the German Council of Economic Experts, the "Five Wise Men" who advise the government, and at the Bundesbank, where he directed the monetary policy and analysis division.

He was sent to Berlin by Weber, one of his economic professors in Bonn who was impressed by his student's grasp of economic theory and pragmatism.

Weidmann "combines a solid background in economics with first-hand experience in containing severe financial crises in Europe," Berenberg Bank chief economist Holger Schmieding told AFP.

He worked feverishly behind the scenes to hammer out rescue plans for German banks embroiled in the global financial crisis and for carmaker Opel.

"No position is likely to be as exciting" after such experiences on the brink of disaster, the German daily Sueddeutsche Zeitung commented in an article about Weidmann.

Speculation as to his future grew in January when Weidmann was named to replace an outgoing member of the Bundesbank board, which is based in Frankfurt, with his wife and two children close by.

Some suggest the choice could spark concerns it was more political than practical.

Barclays Capital economist Thorsten Polleit told AFP that "eyebrows might be raised" at the path leading straight from Merkel's office to the central bank.

Schmieding noted however that "history shows that, (once) in office in Frankfurt, Bundesbankers are fully independent of those who had appointed them."

The Sueddeutsche Zeitung said: "Anyone who knows Weidmann realises that while you may justifiably be concerned about his heart given his 70-hour weeks, you needn't worry about his integrity.

"Weidmann has always been loyal to Merkel and from May onwards he will dedicate the same loyalty to the Bundesbank."

© 2011 AFP

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