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ECB Names Praet Chief Economist as Draghi Takes German Job

Peter Praet, executive board member of the European Central Bank (ECB).  Photographer: Tim Boyle/Bloomberg
Peter Praet, executive board member of the European Central Bank (ECB). Photographer: Tim Boyle/Bloomberg

Jan. 3 (Bloomberg) -- European Central Bank President Mario Draghi agreed to put Belgium’s Peter Praet in charge of the bank’s economics division, ignoring calls from Germany that one of its nationals should keep the job.

Praet, 62, will be the first non-German to hold the role since the ECB was founded in 1998 and was a specialist in financial regulation at the Belgian central bank before joining the ECB’s Executive Board in June. Germany’s Joerg Asmussen will be responsible for international relations. France’s Benoit Coeure, another candidate for the economics job, will be in charge of market operations from March.

Draghi’s move sidesteps the political question of whether former finance ministry officials from either Berlin or Paris should mould the ECB’s economic analysis as policy makers are scrambling to end the debt crisis. German Finance Minister Wolfgang Schaeuble said Nov. 29 that Asmussen would be the “best person” to succeed Juergen Stark, who resigned last year to protest the central bank’s bond purchases.

“The ECB has found a pretty good solution to bypass possible national disputes,” said Sebastian Wanke, an economist at Dekabank in Frankfurt. “It’s a clever move to hand the international and European relations portfolio to Asmussen. It’s a more important policy area in the coming years than the position of chief economist.”

Coeure and Asmussen, who come from the euro region’s biggest economies, will nevertheless be at the center of policy making. Asmussen will represent the ECB at crisis meetings of euro-region finance officials in Brussels. As head of markets, Coeure takes charge of the refinancing operations that have become the central toolkit in the ECB’s efforts to fight the debt crisis.

“I am satisfied,” Asmussen told Germany’s Bild-Zeitung newspaper. “Together with ECB President Draghi, I will take care of the short-term crisis management.”

To contact the reporter on this story: Rainer Buergin in Berlin at rbuergin1@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net

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