France expects EU to confirm Draghi as ECB chief: diplomat

24th June 2011, Comments 0 comments

France expects EU leaders to confirm Italy's Mario Draghi as the next president of the European Central Bank (ECB) later Friday, a diplomat said.

"We are heading towards an agreement. We are hopeful that the nomination will be endorsed," a senior European diplomat told AFP on condition of anonymity.

European Union leaders were originally expected to endorse Draghi's nomination late Thursday but the decision was delayed until the second day of a Brussels summit.

Diplomatic sources said France was behind the delay because Paris, despite its full public support of Draghi's nomination, wants guarantees that it will get a seat on the ECB executive board in return.

The senior diplomat said that "contacts between the two parties to find a solution" were taking place on Friday. Another diplomat said that "there has been a lot of backroom movement to find a solution."

A third diplomat, however, said the situation had "not evolved compared to last night."

A draft of the conclusions to be adopted by EU leaders on Friday says they "appointed Mr Mario Draghi President of the European Central Bank from 1 November 2011 to 31 October 2019," but similar language was already in a previous version on Thursday.

The head of the Bank of Italy would replace Frenchman Jean-Claude Trichet which would leave France without a seat on the Frankfurt-based bank's board while two Italians, Draghi and Lorenzo Bini Smaghi would be present.

One solution under consideration is to announce a political agreement to back Draghi's nomination at the summit but without signing off on the official confirmation until Smaghi steps down, a diplomat said.

Draghi, who officially has the backing of all EU nations including France, received the support of the 17 eurozone finance ministers last month and on Thursday won a green light from the European parliament.

French President Nicolas Sarkozy, who attended the summit, has been one of Draghi's most vocal supporters but has insisted that under an unwritten rule, the major eurozone countries should each have a seat on the ECB board.

"The support France gives to Mario Draghi is not qualified," French government spokesman Francois Baroin said on Wednesday, reiterating its public support for the Italian central bank chief.

Under a deal struck with Sarkozy earlier this year, Italian Prime Minister Silvio Berlusconi has asked Smaghi to resign.

"Italy has given its word. I have no reason to doubt its word," Sarkozy said last week.

But Smaghi has refused to budge so far, insisting that the ECB is an independent body which does not bow to political pressure, as guaranteed in the Maastricht treaty which created the eurozone.

© 2011 AFP

0 Comments To This Article