Germany wants Bundesbank chief Weidmann to replace Draghi

weidmann draghi

Angela Merkel and Wolfgang Schaeuble want to install a German at the head of the European Central Bank when Mario Draghi’s term expires in 2 1/2 years, according to Spiegel magazine.

The chancellor and her finance minister are set to push for Bundesbank President Jens Weidmann to become the fourth guardian of the single currency, arguing it’s finally Germany’s turn after the Netherlands, France and Italy, Spiegel reported, without saying where it got the information. Weidmann is willing to accept the post if it were to be offered to him, according to the pre-release of an article published Friday.

There’s absolutely no need at this time for a debate, let alone a decision, about Draghi’s succession, a German government spokesman said in an emailed statement. A Bundesbank spokesman said any discussion is premature.

While Draghi’s term as president runs until the end of October 2019, speculation is already building on who might inherit his position. The process of determining a successor hasn’t yet begun, and judging by previous choices, is likely to be fraught with intense political bargaining that could preoccupy euro-region officials for months.

In France, led by political newcomer Emmanuel Macron, Bank of France Governor Francois Villeroy de Galhau is tipped to be a contender for the job. Melvyn Krauss, a senior fellow at the Hoover Institution at Stanford University, argued in an article in Germany’s Zeit newspaper earlier this month that Macron’s victory paves the way for the Frenchman to claim the ECB prize.

In Germany, Merkel might use her push for Weidmann, her former chief economic adviser, in her bid to win a fourth term in national elections in September. Skepticism of the ECB’s policies runs high in the country where monetary orthodoxy are enshrined in the national DNA.

Spain, which hasn’t held a seat on the Executive Board of the ECB since 2012, has already started arguing for one of the management panel’s six posts. Vice President Vitor Constancio’s mandate expires in May 2018, while the term of Peter Praet, the institution’s chief economist, is up the following year. Benoit Coeure’s position will be available as of the start of 2020.

Any candidate requires an endorsement by all European Union finance ministers. They then need to sit through a hearing at the European Parliament, which casts a non-binding vote, before finally being confirmed by euro-area leaders for an eight-year term. The parliament has no power to block ECB appointments.