What is the Eurogroup anyway and why should we care? Here is the low down as Minister for Finance Paschal Donohoe emerges as the unopposed candidate for a second term as Eurogroup president.
What is the Eurogroup?
The finance ministers of all countries that use the Euro as a currency meet once a month, usually in Brussels. This is the Eurogroup: it’s quite informal and does not have lawmaking power, but it is highly influential in decision making among European Union countries, particularly in times of economic trouble. This is where bailout agreements were hammered out during the economic crisis, for example. It has 19 members, soon to be 20 when Croatia joins the euro on January 1st.
What does its president do?
The president chairs the discussions, prepares the agenda, sets its long-term work programme, and represents the group in important international meetings with top global leaders. It’s an unpaid role but with a high level of international visibility, particularly during times when the EU is facing economic challenges, trying to resolve internal disagreements, or making a big step forward in its financial policy such as during the Covid-19 crisis.
Why should I care?
Having an Irish figure in the position is valued by the Irish State because it means having someone in the room when important decisions are made. The role of the president is to act as a fair dealer who will establish the group’s consensus view and broker agreements on some of the European Union’s fault line issues, such as the north-south, frugal-liberal split on debt and spending rules – an issue that is soon due for a crunch decision on reform. Aside from putting the president in close contact with all the Eurozone finance ministers, it also means they work alongside global top decision-makers, such as the European Central Bank chief Christine Lagarde or United States Treasury Secretary Janet Yellen.
What was the fuss about Paschal Donohoe’s re-election?
Mr Donohoe was initially elected president of the Eurogroup in July 2020, beating the rival candidate from Spain Nadia Calviño. His term was due to end in January. He wanted to run for a second term, but the role is usually chosen from among finance ministers – and Donohoe must push over to make room for a Fianna Fáil finance minister when Leo Varadkar takes the Taoiseach’s job in mid-December. Fine Gael initially sought to retain the finance portfolio so Donohoe could stay in post. But Fianna Fáil made it clear that wouldn’t happen – though some mischievous FFers said that FG could keep the finance job all right – as long as Micheál Martin kept the Taoiseach’s Office.
So what happened?
In a quiet campaign over recent weeks, Donohoe convinced his colleagues that the “Juncker precedent” should apply – that he could be chair of the group and Ireland would have a separate representative as an ordinary member of the group. This happened previously when Luxembourg prime minister Jean-Claude Juncker was president and his country’s finance minister also attended. Initially sceptical EU diplomats said that while Donohoe was highly regarded, he was no Juncker. But he convinced them he was a bit of a Juncker.
Has Donohoe done a good job to date?
The fact that no candidate ran against Mr Donohoe reflects his broad support about other EU member states. He was publicly backed by Belgium and the Netherlands and quietly said to have been supported by France and Germany as well. Diplomats and officials said he was well thought of in the role and considered a safe pair of hands. Now he gets another two and a half years – taking him right up to the end of the present Coalition.