Axel Weber, the chief of the Deutsche Bundesbank and possible candidate for the position of President of the European Central Bank (ECB), announced that he would step down from his job by the 30th of April. This unexpected announcement has thrown the calculations of German Chancellor Angela Merkel off and complicated the present economic situation in Europe. Axel Weber expressed that he no longer wanted to be the chief central banker nor does he want to replace current ECB president Jean-Claude Trichet who will be leaving his post in October.
Reportedly, Weber was “disillusioned” by the ECB’s policy of buying government bonds to assist Eurozone economies in major debt especially after fears in the markets rose when the European Central Bank purchased Portugal’s bonds last week.
Chancellor Merkel was depending on Axel Weber to become the ECB’s first German president so the German government could calm and reassure German lawmakers and citizens that the monetary system will be remaining strong and stable. Such assurances are needed as the European Union has seen through very unpopular and resented bailouts of countries such as Greece which sparked the 2010 riots and protests in Greece after the Greek government accepted EU conditions and cut down economic benefits for its citizens.
Now that Weber is out of the picture, Germany and other European countries may fight over the nationality of the next ECB president which could disrupt the European Central Bank in its current stressing work in helping debt-ridden European countries.
The fight over nationality will not be the first of its kind as there was a dispute between the French government and the German, Belgian and Dutch governments over what nationality the first ECB head should’ve been back in the 1990′s. Trichet was chosen as the French favorite but in the end Netherlands’ Willem Frederik Duisenberg became the first ECB president.
The Germans do not have a ‘Plan B’ candidate who has the equal caliber and skills of Axel Weber which has caused political parties in Germany to suggest their own candidates. Just today, former finance minister Peer Steinbrueck was ‘nominated’ by his own party however Steinbrueck declined the offer.
If the Germans do not have another Weber then European governments will naturally look to another qualified candidate but just of different nationality. Already, Italy’s central bank chief, Mario Draghi, who was Weber’s rival for the position of the ECB president was suggested as the ‘next candidate’. Yet some say that Draghi may not be strong in his public image as southern areas of Europe are among the most hard-hit economically.
Some European senior officials have emphasized that the candidate should be based on merits not nationality. Furthermore they have suggested that the decision to appoint Trichet’s successor be put off until a later and more appropriate time as the public may just see current ECB president Trichet as a lame duck.
The German government stated that it will be choosing Axel Weber’s successor by next week.