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Jobshare pact on who runs Emu

Imre Karacs
Friday 30 January 1998 00:02 GMT
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Germany and France have struck a compromise in their dispute over who should be in charge of Europe's common currency. The solution, according to the German financial daily Handelsblatt, is job-sharing.

The paper claimed that a "gentlemen's agreement" had been reached, allowing the two main candidates to split the eight-year term at the head of the European Central Bank. Germany is backing Wim Duisenberg, the head of the Dutch central bank. France has nominated Jean-Claude Trichet, Mr Duisenberg's opposite number in Paris.

An EU spokesman denied yesterday that such a deal had been reached, insisting the winner would be selected at a summit in May. The Handelsblatt story is nevertheless plausible, because it has always been understood that Germany and France would cast the deciding votes. The assumption was that German concerns about the stability of the euro would only be allayed by the choice of a respected central banker committed to a hard currency.

Mr Duisenberg fits the bill perfectly. There was, the Germans say, a "gentlemen's agreement" already in existence.France's desire to have a say, through a "stability council" representing member governments, was to have been balanced by a German nominee at the head of the all-powerful European Central Bank.

But a month ago, France upset this cosy arrangement by throwing its own man into the ring. If the report is true, Mr Duisenberg, 63, will be allowed to rule in the important first four years. After that, he will hand over the baton to Mr Trichet, 55. By then, Europe should be trading with the new coins.

- Imre Karacs, Bonn

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