Saturday

27th May 2017

Trichet concerned over EU treaty change

  • Jean-Claude Trichet is acting to ensure his bank's continued independence (Photo: EUobserver)

The European Central Bank (ECB) last week sent a letter asking member states to make sure that the bank's independence is maintained in a new EU treaty following a small but potentially significant change to the draft treaty outline.

In a letter sent to the current Portuguese EU presidency published 9 August, ECB head Jean-Claude Trichet asked for specific changes that would guarantee that the bank has a special status, separate from other EU institutions such as the parliament and commission.

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"Because of its specific institutional features, the ECB needs to be differentiated from the union's institutions," said Mr Trichet in his letter sent to Manuel Lobo Atunes, Portuguese Europe minister.

This special status was secured in the original draft EU constitution, which fell by the wayside after being rejected by French and Dutch voters two years ago.

But the clause did not make it into the outline for a new EU treaty agreed by EU leaders before the summer and set to be finalised by the end of the year.

Mr Trichet fears that if the current treaty outline remains the same, with the ECB listed along the commission and parliament as an institution, it will be subject to the same general rules as these institutions which work together and follow certain agreed goals and European values.

This could leave the bank legally open to pressure from EU leaders to follow certain more politcal goals.

Maintaining the bank's independence has become more of a public battle ground since French president Nicolas Sarkozy came to power earlier this summer.

Mr Sarkozy has made several comments indicating that he would like to curb the bank's independence by calling for greater political influence in monetary policy making.

Mr Sarkozy has also repeatedly criticised the strength of the euro as well as what he sees as the bank's too strong emphasis on inflation.

Late last month the bank publicly hit back at the French president.

"The President of the ECB repeats with gravity that any attempt to seek to influence... the ECB in the performance of its tasks' violates Article 108 of the EC Treaty and that therefore such declarations are not acceptable,'' said a spokesperson on behalf of Mr Trichet.

France and Germany divided over new ECB status

The status of the European Central Bank in the new EU treaty is causing friction between France and Germany, with Paris in favour of the bank being considered a normal EU institution and Berlin opposing it.

Portugal held up as symbol of EU recovery

Portugal to sail out of troubled waters after eight years of financial crisis, EU commission predicted, amid broad but "fragile" recovery in European economy.

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