Eurogroup Chief Search Kicks Off With Donohoe in Prime Position | Company Business News

(Bloomberg) — The Eurogroup is about to kick off its search for a new president, with Paschal Donohoe seen on track to win a third term, a feat that would make the Irishman the second-longest-serving chair of the euro zone’s finance-chief meetings.

Ministers from the 20 countries are set to approve the plan to elect a new head when they meet in Luxembourg on Thursday. They have less than a month to decide, in time for the end of Donohoe’s current 2 1/2 year term in mid-July.

Originally designed as an informal forum to exchange views, the Eurogroup morphed into one of the region’s most closely watched decision-making bodies, notably so as the euro-area debt crisis reached its peak. 

Finance ministers held many often acrimonious meetings, striking late-night deals on emergency bailouts for five countries, an overhaul of the EU’s banking rules, and eleventh-hour loans to keep Greece from defaulting and crashing out of the euro.

The Eurogroup has only had four chiefs since the role became permanent two decades ago: Jean-Claude Juncker of Luxembourg from 2005 to 2013, followed by Jeroen Dijsselbloem of the Netherlands in the five years after that, and then Portugal’s Mario Centeno until 2020. 

That’s when Donohoe — who is now 50 — first took on the role, beating candidates from Spain and Luxembourg to get the position during the pandemic. His bid for a second term went through unopposed, but this time there’s speculation of potential challengers. Lithuania’s Rimantas Sadzius has suggested he may throw his hat in the ring and media reports have also mentionede Carlos Cuerpo of Spain.

Whoever does win will take on a job facing heightened scrutiny, given a concerted push for reform by the region’s top five economies — Germany, France, Italy, Spain and the Netherlands. 

They argue that while the Eurogroup proved itself when crises hit, it has been a lot less decisive and nimble at other times.

One example they cite is the current struggle to achieve so-called capital markets union. That initiative has failed to take off so far, despite being a priority for the bloc that Donohoe has pushed for.

The five countries are also seeking more streamlined meetings, in a call for action on an area where Donohoe’s input may be particularly pivotal.

“Save for financial turmoil times, the Eurogroup meetings would be more impactful if they were dedicated to a limited number of items, with strong political implications,” they wrote in a so-called non-paper seen by Bloomberg. 

Another criticism is over potential overlap with matters handled by Ecofin, which is the broader meeting of European Union finance chiefs. The countries want discussions to hone in on issues related to the specific responsibilities shared by its members for the single currency.

Regarding topics to focus on, the five countries highlighted capital markets union, innovation, economic resilience and competitiveness. 

–With assistance from Kamil Kowalcze, Michal Kubala, Alessandra Migliaccio, Milda Seputyte and William Horobin.

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