Eurogroup race hits milestone with no official candidates yet

Spain's Economic Affairs minister, Nadia Calviño, and Eurogroup President, Paschal Donohoe, in a meeting last year.

The deadline for eurozone finance ministers to put forward their candidacy to chair the Eurogroup ends on Thursday (25 June), with no official contenders yet, although Spain’s Nadia Calviño, Ireland’s Paschal Donohoe and Luxembourg’s Pierre Gramegna are seen as leading the race.

Applicants must put their names forward before Thursday by “close of business,” or around 6pm, an EU official told The vote is planned for the next Eurogroup, scheduled on 9 July. 

Among the candidates to succeed Portuguese finance minister Mario Centeno, Calviño is considered as “the frontrunner”, EU diplomats told EURACTIV. The Spanish economic affairs minister embodies the socialists’ efforts to keep the post in their hands for another term. 

Mario Centeno quits Eurogroup post, Portuguese government

Portuguese Finance Minister Mário Centeno, the Eurogroup’s president, has resigned from government, following a period of less than idyllic relations with Prime Minister António Costa, and will be replaced by state secretary for budget João Leão.

Calviño is well regarded among her colleagues, given her previous experience as director general in the European Commission, her knowledge of the dossiers and her good relationship with her German and French colleagues, Olaf Scholz and Bruno Le Maire. 

But Northern EU countries see her as a staunch defender of the eurozone integration, which is not a top priority for them. In addition, rival political families argued that two socialists have already held the post in a row.

Sources close to Calviño did not give any information about when she would submit her candidacy, hours before the deadline expired. Spanish prime minister Pedro Sánchez threw her in the race on June 14, saying that the Spanish Government was “very interested” in the position. Madrid confirmed on Thursday morning that she would run.

Spain's Calvino boasts 'key role' in Eurogroup to support her candidacy

Spain’s minister of Economy, Nadia Calviño highlighted her “key role” in preparing the Eurogroup response to the COVID-19 crisis, as the eurozone finance ministers will pick a new president in early July.

Her main potential rival could be Irish Finance Minister Paschal Donohoe. Two EU diplomats agreed that he could have a good chance against Calviño if he decides to run. 

In order to become Eurogroup president, the winner needs to convince 10 of his 19 colleagues. There will be several rounds of voting until two finalists emerge.

Donohoe hails from the centre-right European People’s Party (EPP) and could count on the seven votes from finance ministers coming from his political family. Two ministers from  the centre-right and the extreme right could also support him. 

Calviño, on the other hand, would sum at least five votes from her own political family, the Socialists and Democrats.

But the calendar plays against Donohoe’s candidacy, as the Eurogroup election comes in the midst of negotiations to form a new Irish government. The Greens, who are part of the Irish executive, will have to approve the deal on Friday, and it is not entirely clear whether their members will back the deal, which would require a two-thirds majority. This uncertainty could delay Donohoe’s confirmation as finance minister before election day.

Donohoe’s decision to run or drop from the race could influence Luxembourg’s finance minister, liberal Pierre Gramegna, one of the veterans in the group who was a candidate against Centeno in the last election round. 

An EU diplomat confirmed that Donohoe and Gramegna’s chances “would seriously increase” if the other dropped  out of the race.

Officials consulted by EURACTIV said Gramegna received support from Benelux countries in recent days.

A diplomat said that France had yet to decide what candidate to support, depending on the backing that Paris would receive in return in its bid to lead the European Bank for Reconstruction and Development.

Centeno: ‘The old books by which we governed are of no use in this period’

In an interview with the Portuguese newspaper Público, the President of the Eurogroup, Mário Centeno, shared some leads about the EU’s recovery plan. He believes that the new recovery plan should have its “own, appropriate and innovative funding mechanism”.

Some officials see Gramegna as a potential “bridge” candidate able to balance all the parameters considered for the post. For instance, he could be a compromise solution between the North and South blocs, between big and small countries, and between the socialists and the EPP.

Hours before the deadline expired, the potential candidates kept their cards close to their chest and speculation was running high.

While one diplomat took for granted that Donohoe would throw his hat into the ring, another pointed out that Gramegna could emerge as the consensus candidate. Diplomats did not exclude either that more than three candidates could emerge to chair the Eurogroup.

The winner will steer the body for the next two and a half years at a time when the Eurogroup is trying to regain its influence during the recovery phase of the coronavirus crisis.

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The Eurogroup finally agreed on a €500 billion package to support member states, companies and workers in the coronavirus crisis, after The Netherlands and Italy overcame they differences. Leaders will discuss in the coming days the recovery plan and the possibility of ‘coronabonds’.

(Edited by Frédéric Simon)

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