The next president of the Eurogroup has the task of making the body relevant again, or reading its last rites
is arguably the European Union’s strangest institution. It started life as a dining club for euro-zone finance ministers to gossip before the official meetings of ministers from the whole, yet morphed into a forum where the fate of nations was decided. During the euro-zone crisis, the terms of bail-outs totalling more than €500bn were agreed at its informal, closed-door meetings, at which no minutes were taken . Even its legal existence is a matter of debate.
Now, the hunt is on for a new jockey to steer this peculiar beast. After two-and-a-half years as the group’s president, Mário Centeno, the Portuguese finance minister, is stepping down. Haggling over his replacement is already under way. Nadia Calviño, Spain’s economy minister and a former official in the European Commission, is in the running and well-regarded. But that is only part of the battle.is a club that includes a preponderance of small countries.
Whoever wins will take over a less prominent institution. The Eurogroup reigned almost supreme in the euro-zone crisis. But in the current mess it cuts a smaller figure. When the euro teetered, the Eurogroup was a useful intergovernmental forum for the two sides: those who had money and those who needed it . It operated as a ministerial fight club, where governments could brawl without diplomatic incident.
Fundamentally, the Eurogroup was a stopgap, a way of papering over the cracks inherent in a monetary union without fiscal transfers. Now, however, European leaders are showing a willingness to plug these holes themselves. In April the Eurogroup tried to cook up a fiscal response to the coronavirus crisis. While ostensibly large—it included €540bn-worth of loans—it was deemed inadequate by countries such as Spain, which demanded that any cash come in the form of grants, never to be paid back.
Others propose more radical schemes to keep the Eurogroup relevant. After a decade in retreat, Europe’s federalists are on the offensive. Handing the group’s presidency to antreasury, argues Andrew Duff of the European Policy Centre, a think-tank. Appointing someone like Paolo Gentiloni, thecommissioner in charge of the economy and a former Italian prime minister, would make sense, given that the commission is likely to be the one in charge of the €750bn in extra crisis spending.
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