Italy's Lorenzo Bini Smaghi resigns from ECB board

10th November 2011, Comments 0 comments

European Central Bank board member Lorenzo Bini Smaghi of Italy has announced he will resign this year, the bank said Thursday, following pressure to give up his seat to a French colleague.

"Today, Lorenzo Bini Smaghi, Member of the Executive Board and Governing Council of the European Central Bank, informed President Mario Draghi that he will resign from his position prior to the end of his term of office on 31 May 2013 to join Harvard Universitys Center for International Affairs on 1 January 2012," the bank said in a statement.

It said Draghi had thanked his compatriot "for his contributions in the field of European and international monetary and economic affairs over many years.

"Throughout his mandate, including in taking his decision, Mr Bini Smaghi has upheld the independence of the ECB," it said.

"Mr Draghi expresses his gratitude for Mr Bini Smaghis outstanding contribution to the work of the ECB and his dedication as a member of the Executive Board and Governing Council for more than six years."

The Italian press had reported just last month that Bini Smaghi would not succumb to pressure from French President Nicolas Sarkozy to clear the way for a Frenchman on the board comprised of six members.

When fellow Italian Draghi was appointed to take over as ECB chief to replace Jean-Claude Trichet of France in June, European officials widely speculated that Bini Smaghi would resign in exchange for the top job at the Bank of Italy.

But Italian Prime Minister Silvio Berlusconi chose another candidate, Ignazio Visco, after weeks of indecision in the government.

The situation left two members from Italy on the ECB board and France empty-handed.

"A disappointed Bini Smaghi will not resign," Il Sole 24 Ore financial daily reported on October 21.

Bini Smaghi "has always explained his unwillingness to resign as a defence of the ECB's autonomy," but now "risks provoking a serious hardening of the French position," it wrote at the time.

France supported Draghi's candidature for the ECB post but on condition that a French official would take Bini Smaghi's place following the unwritten rule that no country should hold two seats on the board at the same time.

In late October Berlusconi again called on Bini Smaghi to step down to avoid creating unnecessary tensions with France as the eurozone crisis rages on.

Meanwhile Sarkozy said on October 27 at the end of an EU summit in Brussels said France could not accept not having a seat on the ECB's board.

© 2011 AFP

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