ECB's Next President Trichet: No Obstacles

UNCLAS FRANKFURT 005345

SIPDIS

SENSITIVE

STATE FOR EUR PDAS RIES, EB BAY, EUR/AGS, AND EUR/ERA
STATE PASS FEDERAL RESERVE BOARD
STATE PASS NSC
TREASURY FOR DAS SOBEL
TREASURY ALSO FOR IMI HARLOW, AUSTIN
PARIS ALSO FOR OECD
TREASURY FOR OCC RUTLEDGE, MCMAHON

E.O. 12958: N/A
TAGS: ECON EFIN EUN
SUBJECT: ECB's Next President Trichet: No Obstacles
Foreseen


T-IA-F-03-36

This cable is sensitive but unclassified. Not/not
for Internet distribution.


1. (SBU) Summary: European Central Bank (ECB) senior
officials do not foresee any obstacles to Jean-Claude
Trichet becoming the next President of the European
Central Bank. Finance Ministers are scheduled to make
their official recommendation at the Ecofin meeting on
July 15. The ECB Governing Council and Parliament will
then be consulted and give their opinions. Final
approval by heads of state should take place at the
European Council on October 16-17. Trichet is expected
to be in office by the end of October, early November.
End Summary

Thessaloniki Council Jumps the Gun


2. (SBU) The Presidency's conclusions of European
Council meeting of June 19-20 in Thessaloniki states
that the Heads of State or Government "have decided on
the candidacy of Jean-Claude Trichet for the presidency
of the European Central Bank." They went on to "invite
the Council (ECOFIN)," at its next session, to initiate
the necessary procedures under the Treaty.


3. (SBU) While this was a clear political signal, a
senior ECB official points out that the Council got a
bit ahead of itself. Under the Treaty the ECOFIN has
the responsibility to take the initiative for
recommending a new ECB president. The Council's
conclusions have no binding effect.

Appointment Process and Schedule


4. (SBU) According to the ECB official, at the July 15
Ecofin meeting Finance Ministers should make their
recommendation for Trichet to become the next ECB
President. Under Article 11 of the ECB's statutes,
before this recommendation goes to the Heads of State
or Government for a decision, the Governing Council of
the ECB and the European Parliament have to be
consulted. Both issue non-binding opinions.


5. (SBU) There had been some discussion that the
Economic and Monetary Affairs Committee (EMAC) of the
Parliament would hold a special hearing in July,
according to the ECB official. However, he reports
that EMAC decided that no special session was necessary
and will hold its hearing in the second half of
September (Note: EMAC has sessions scheduled for
September 10 and 30). The hearing will afford an
opportunity for committee members to pose questions to
Trichet.


6. (SBU) Given the timing of the anticipated Ecofin
recommendation and the EMAC hearing, the Governing
Council of the ECB would render its opinion either at
its meeting on July 31 or its August 21 session. Heads
of State or Government at the October 16-17 European
Council meeting could then give their formal
endorsement.


7. (SBU) According to this ECB official, Trichet
should be able to be in the ECB's President's office in
late October, early November. He said, "No obstacles
are foreseen in this process."


8. (U) This cable was coordinated with US Embassy
Berlin and USEU.

(U) POC: James Wallar, Treasury Representative, e-mail
wallarjg2@state.gov; tel. 49-(69)-7535-2431, fax 49-
(69)-7535-2238.

BODDE