Asmussen zet eerste stap richting bestuur ECB (en)

After a two-hour question and answer session on Monday, Economic and Monetary Affairs Committee MEPs overwhelmingly recommended Jörg Asmussen to become Jürgen Stark's successor on the ECB Executive Board. In discussion, Mr Assmussen took a less hawkish stance than Mr Stark's, but did insist that the EU bailout fund should not call on ECB liquidity to enhance its firepower. Parliament is to vote on his candidature this Thursday.

Mr Asmussen fielded questions from MEPs in three broad categories: ways out from the Eurozone crisis, improving financial regulatory reform and enhancing communication.

Out of the crisis

To deal with the crisis, Mr Asmussen said a five-pronged strategy is needed: a credible way to reduce Greece's gaping budget deficit and improve its competitiveness; better use of the EU bailout fund (including allowing it to buy bonds direct from the countries issuing them); a recapitalisation of all Europe's "systemically important" banks and securing their access to funding; a stronger commitment by countries running deficits to fiscal consolidation; and better economic governance, including through treaty changes. 

Mr Asmussion did not reject the possibility of making private investors take a bigger hit to alleviate Greece's burden, but said that it was necessary first to wait for the results of the latest monitoring report  by the ECB, IMF and Commission officials, due out next week.

Regulatory reform - restoring the momentum

Picking up on MEPs' comments that countries had blocked the G20 agenda, Mr Asmussen sounded the alarm on financial services reform, saying that the momentum had, "for some reason or another", been lost.  "We cannot afford to go back to a pre-Lehman world", he told MEPs. 

Apart from passing new regulatory legislation, it was also necessary to improve the implementation rate of rules already drawn up, he added.

Communication is the key

Mr Asmussen several times stressed that communicating well is the "key" to maintaining the ECB's credibility and legitimacy. This would be a growing challenge due to the excessively fast speed at which markets demand information, which often risks crowding out communication efforts to explain the ECB's actions, he said. 

You can watch the recording of the debate via the Video on Demand service (link below) or highlights via the EbS link, also below.