PARIS — In European football, they’d call it the opening of the transfer window. The selection of Portugal’s Mário Centeno on Monday as the head of the Eurogroup — the powerful gathering of eurozone finance ministers — was the first contest on the road to 2019, when new leaders will take over the EU’s most powerful institutions: the Parliament, Commission and European Central Bank.
European players big and small have started to trade favors, push candidates for the jobs they covet and bargain support for other countries’ nominees to safeguard their national interests. For the first time, all the big appointments will take place in the same year, meaning there is more riding on the first personnel decisions like the Eurogroup election.
In the short term, the appointment of a socialist from a country at the receiving end of a eurozone bailout in 2010 means the Eurogroup will be headed by someone more likely to push for further integration of monetary union than to resist it, as a northern European might have done.
But expectations shouldn’t be raised too high: The job is foremost one of a compromise broker — one reason it tends to go to a smaller country not easily suspected of pushing its own agenda.
In early 2018, eurozone governments will pick a vice president for the European Central Bank. In spring 2019, the European Parliament election will see the Spitzenkandidaten from the main center-right and center-left blocs compete for the presidency of the Commission (the runner-up gets to chair the Parliament).
Around the same time, eurozone leaders will choose a successor to ECB President Mario Draghi, whose eight-year term ends in October 2019.
Games of give-and-take
For all the national strategy involved in such contests, the reality — according to a French Treasury official who is a veteran of the backroom dealing — is that “governments often decide at the very last minute.”
Centeno’s election means Round 1 has been won by “the south” (in this case, a group including Portugal, Spain, Italy and arguably France) and “the left.” In EU tradition, this means that countries from “the north” and the political right now have a bargaining chip for subsequent appointments.
Such procedures have unwritten rules — which are often broken.
Pierre Gramegna, the finance minister of Luxembourg who was a candidate for the Eurogroup job, complained about such backroom dealings when it first became clear last week that Centeno had been favored by an informal deal between French President Emmanuel Macron and German Chancellor Angela Merkel on the sidelines of a summit in Africa.
Such maneuvering, however, should hardly surprise a minister from Luxembourg, where current Commission President Jean-Claude Juncker once simultaneously held the jobs of prime minister, finance minister and Eurogroup president.
Another observation from the veteran French Treasury observer is that such procedures have unwritten rules — which are often broken.
Take, for example, the understanding that the presidency and vice presidency of the ECB should be split between north and south. Current ECB Vice President Vítor Constâncio, a former Portuguese central bank governor, was appointed in 2010 with Germany’s support. At the time, Bundesbank President Axel Weber looked like a shoo-in to become ECB president the next year.
But Weber antagonized then-French President Nicolas Sarkozy with his harsh criticisms of the decisions made by then-ECB President Jean-Claude Trichet. Weber had to take himself out of the running. As a result, when Draghi was appointed in 2011, the central bank’s top two officials were from the south.
That is likely to happen again next year if the current favorite to succeed Constâncio gets the job. Spanish Finance Minister Luis de Guindos has made no secret of his interest in the ECB job and refrained from running for the Eurogroup presidency this time, as he did two years ago. His appointment next year would again be taken as a sign that Merkel hopes the ECB presidency will go to a German — with current Bundesbank President Jens Weidmann the obvious favorite.
The Macron factor
When governments start thinking about the ECB post in the spring of 2019, they will also have to ponder whom they will support for the top jobs in Brussels, though the Spitzenkandidat system introduced in 2014 limited the scope for traditional EU backroom deals. Proof of that is that Merkel, despite all her influence over Europe, was unable to prevent the Commission presidency going to Juncker.
Another factor of uncertainty in the 2019 sweepstakes will be Macron’s apparent refusal to take one side or the other in the traditional conservative-socialist divide, which could upset the balance of job distribution. But the French president’s attempt to create a pan-European movement that defies right-left definitions looks like an uphill struggle, meaning there may be no centrist Spitzenkandidat role for a liberal figure like Competition Commissioner Margrethe Vestager.
“Governments may say that it’s much too early, but candidates always fear they’ll start too late” — Commission official
Macron can, of course, be expected to push for French candidates to secure key roles — or at least candidates with whom he feels he can do business.
Meanwhile, the game of speculation on the meaning of potential candidates’ every move and gesture is already well underway.
For instance, whenever the Bundesbank’s Weidmann sounds less hawkish than usual, it is taken as a sure sign that he has started courting the votes of the southern governments he has so often criticized as being too profligate.
And whenever the French Central Bank governor François Villeroy de Galhau warns countries against fiscal insouciance, it is seen as eagerness to show Berlin that he can be as hawkish as the next German and would make a great ECB president.
“Governments may say that it’s much too early, but candidates always fear they’ll start too late,” said one Commission official. “But don’t forget that the longest-planned and best-organized campaign can flounder on unpredictable political twists and turns.”