France launches late bid to capture key euro job

Date: 01/10/1998

By Tim Jones

A BEHIND-the-scenes battle has broken out between governments over who should head the EU's key economic policy-making panel once monetary union begins in January.

Senior officials say French treasury director Jean Lemierre has emerged as a challenger to his Italian counterpart Mario Draghi as the first chairman of the economic and financial committee, which will replace the EU's powerful monetary committee once the euro appears and current president Nigel Wicks steps down.

Paris is pressing Lemierre's candidacy after failing to win the leadership of the European Central Bank. But if it succeeds, this could have unfortunate consequences for other leading French job-holders, given the principle in allocating top EU positions that no one country should hold too many key posts at the same time.

Among those who could be affected are Economics Commissioner Yves-Thibault de Silguy, who is understood to be eager to win a strengthened role in the Commission team which takes office in January 2000, and Elizabeth Guigou, who is a possible candidate for the new job of EU foreign affairs High Representative.

The chairmanship of the EFC, which will be made up of representatives from each EU member state's finance ministry and central bank plus the European Commission and the ECB, would be a major prize for any government.

Most intergovernmental negotiations before meetings of finance ministers and summits will be carried out by committee members. They will also prepare the work of the Euro-11 ministerial coordinating group.

The chairman will not only play a vital role in setting the panel's agenda and making the minuted remarks which sum up its deliberations, but will also attend ministerial meetings and help represent the euro area in international fora such as the Group of Seven club of leading industrialised nations.

Draghi has been the front runner until now, following the elevation of his only rival, Luxembourger Yves Mersch, to the presidency of his country's newly formed central bank.

Draghi has been the Italian treasury's representative on the committee for seven years, having served in Washington at the World Bank between 1984 and 1990.

Lemierre, on the other hand, has been the French political representative on the committee for just three years.

The ambitious 48-year-old was hired as chief of staff to Alain Madelin during his short reign as French finance minister when Jacques Chirac first won the presidency in May 1995. He had the confidence of the free-marketeer Madelin and was also very close to then Prime Minister Alain Juppé; a fact which caused him severe problems with Madelin's successor Jean Arthuis.

Although Arthuis kept him on as chief of staff, he began to suspect that Lemierre's loyalties lay with Juppé. He accused Lemierre of holding meetings with the premier's staff without his knowledge and eventually, in September 1995, he demanded his removal.

Lemierre was offered the chairmanship of the Paris stock exchange's watchdog and then a place on the board of the post office, but he refused. The only solution was to oust treasury director Christian Noyer, now vice-president of the ECB, from his job and offer it to Lemierre.

The Italian government is pressing Draghi's bid for the EFC chairmanship equally hard.

It believes it has a strong case, given his track record and Rome's current under-representation in key international jobs, especially once Renato Ruggiero steps down from the World Trade Organisation in April next year.

France has put forward Jean Lemierre as a candidate to chair the new European 'Economic and Finance Committee'.