Sarkozy pushing ally for ECB board: report

23rd June 2010, Comments 0 comments

French President Nicolas Sarkozy wants one of his top economic aides to sit on the European Central Bank's board when its head, Jean-Claude Trichet, steps down, a German paper said on Wednesday.

Sarkozy is campaigning for Xavier Musca to be appointed to the six-person Executive Board when Trichet retires in October 2011 in exchange for allowing a German to lead the bank, the Handelsblatt daily said, citing European sources.

Musca, 50, is currently Sarkozy's deputy chief of staff and main advisor on economic issues.

The head of Germany's central bank, 53-year-old Axel Weber, is currently front-runner to take the top job at the ECB, although the race is not yet officially open.

Weber is known as a monetary policy "hawk", a committed battler against inflation, and would not be a universally popular choice. Nobel Prize-winning US economist Paul Krugman said Monday he would be a "risk" for the euro.

Another possible candidate is Italy's Mario Draghi. According to Handelsblatt, Sarkozy would support Draghi for the president's job if Rome backed Musca's appointment.

The Executive Board is made up of six central bankers, including the president and vice president of the ECB.

These six are joined by 16 euro area national central bank heads, which together make up the Governing Council, which sets interest rates for the bloc.

The Maastricht Treaty, which created the eurozone and the ECB, requires that the the central bank be wholly independent of any political influence with regard to monetary policy.

In practice, the big four eurozone countries -- France, Germany, Italy, Spain -- always have a representative on the Executive Board, although this is not officially enshrined in the bank's laws.

© 2010 AFP

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