Draghi chosen new ECB chief as Bini Smaghi clears way
European Union leaders on Friday endorsed Italian central banker Mario Draghi to take over the helm of the European Central Bank in November, after a last-minute wobble over his appointment involving France and Italy was resolved.
"The European Council has just agreed on the appointment of Mario Draghi as new president of the European Central Bank," EU President Herman Van Rompuy wrote on the micro-blogging website Twitter, DPA reported.
France had been threatening to block the decision because Draghi's planned succession to the post currently held by France's Jean-Claude Trichet would have left the country with no representative in the ECB's six-member executive board, while Italy would hold two.
But the second Italian on the board, Lorenzo Bini Smaghi - whose term ends in 2013 - was refusing to resign on the grounds that the ECB's independence would be threatened if he were to bow to political pressures. Diplomats said he relented on Friday.
Amid concern that any hesitation on Draghi would further spook markets already on alert over the Greek debt crisis, Bini Smaghi offered to leave his post by the end of the year, EU sources in Brussels said.
French newspaper Le Monde wrote on its website that the offer was made by telephone to EU President Herman Van Rompuy and French President Nicolas Sarkozy. Van Rompuy also held talks with Italian Prime Minister Silvio Berlusconi, another diplomat said.
Earlier Friday, diplomats were indicating that the EU summit was poised only to take "a political decision" on Draghi's appointment, postponing to a later stage the signature of the legal papers formalizing the move.
Draghi has faced no competition in his bid to succeed Trichet at the helm of the ECB, with an eight-year mandate starting on November 1. On Thursday, he had won the endorsement of the European Parliament.
The Italian government is now under pressure to find a job for Bini Smaghi. One high-profile option is to replace Draghi at the Bank of Italy, although Italian Finance Minister Giulio Tremonti is backing another candidate for the post.