Merkel backs Spain’s de Guin­dos to lead Eurogroup

Financial Mirror (Cyprus) - - FRONT PAGE -

Ger­many will back Span­ish Econ­omy Min­is­ter Luis de Guin­dos as the next head of the Eurogroup of eu­ro­zone fi­nance min­is­ters, re­plac­ing the Dutch fi­nance min­is­ter, Jeroen Di­js­sel­bloem who steps down next year, Chan­cel­lor An­gela Merkel said on Mon­day.

Merkel’s sup­port for de Guin­dos came be­fore talks this Satur­day among EU lead­ers, who are ex­pected to dis­cuss nom­i­na­tions for sev­eral top Euro­pean Com­mis­sion posts among other is­sues. Di­js­sel­bloem’s term does not end un­til mid-2015, but his re­place­ment may come up this week­end, the EU news and pol­icy site Eurac­tiv re­ported.

Merkel gave her sup­port at a joint news con­fer­ence with Span­ish Prime Min­is­ter Mar­i­ano Ra­joy at the end of a two-day visit in San­ti­ago de Com­postela. Her back­ing could prove de­ci­sive due to Ger­many’s con­sid­er­able in­flu­ence.

“Luis de Guin­dos has been an ex­cel­lent econ­omy min­is­ter in dif­fi­cult times,” Merkel said, adding Ger­many would back his can­di­dacy once the term of the cur­rent pres­i­dent was up.

De Guin­dos has served as Econ­omy Min­is­ter in the cen­tre-right gov­ern­ment of Ra­joy since it took power in 2012, the year Spain found it­self at the heart of a grow­ing eu­ro­zone cri­sis.

He had to steer through deep spend­ing cuts as Spain tried to rein in its gap­ing deficit. He also over­saw a 41.3 bln euro bailout of the coun­try’s ail­ing banks, most no­tably Bankia, the con­glo­morate of seven failed re­gional sav­ings banks.

On May 25, 2012, Bankia re­quested a bailout of 19 bln eu­ros, the largest bank bailout in Spain’s his­tory. Bankia was partly na­tion­alised in the bailout, with the gov­ern­ment tak­ing a 61.5% stake.

It sold off a 7.5% stake in Fe­bru­ary this year, be­gin­ning a pri­vati­sa­tion process that, for some, has come to sym­bol­ise Spain’s grad­ual economic re­cov­ery. De Guin­dos has over­seen this im­prove­ment.

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