Jeroen Dijsselbloem was tonight (21 January) appointed president of the eurozone's group of finance ministers.
The Dutch finance minister was elected by a meeting of the Eurogroup in Brussels, at which the prospect of a €17 billion bail-out for Cyprus, Greece's next bail-out instalment and direct bank recapitalisation were also discussed.
His appointment was not unanimous: Dijsselbloem failed to get the backing of Luisde Guindos, the finance minister of Spain.
Dijsselbloem takes over the role of Eurogroup president from Jean-Claude Juncker, the prime minister of Luxembourg, who has been in the post since it was created in 2005.
After tonight's meeting Dijsselbloem said that the eurozone should prioritise restoring sustainable growth in the eurozone, improving employment rates, completing the banking union and continuing fiscal consolidation. He said that achieving balanced budgets and cutting deficits in eurozone countries was “crucial to investment and growth”.
However he denied that this was at odds with his social-democratic beliefs. “I don't think there's a conflict between bringing a budget back to health and working on social solidarity within our societies,” he said.
He added that it was time to stop doubting the integrity of the eurozone. “It would be much more constructive to strengthen the eurozone rather than re-open these debates,” he said.
The appointment represents a rapid rise for Dijsselbloem, a 46-year-old who has been finance minister in the Netherlands for less than three months.
He also finds himself as one of the few centre-left members of a Eurogroup dominated by centre-right governments. Juncker said that Dijsselbloem “embodies all the qualities that will enable him to step into this role”.
The outgoing president paid tribute to the people of Greece, Ireland and Portugal who had made an “immense effort” to comply with austerity conditions linked to their bail-outs. “I hope those countries will be recompensed for their efforts fighting those battles,” he said.
Olli Rehn, the European commissioner for economic and monetary affairs and the euro who also attended tonight's finance ministers' meeting, described Juncker as “a proactive bridge-builder during tough times”.
At the meeting ministers discussed Cyprus's request for a eurozone bail-out as it struggles with a fragile banking sector. Negotiations between the Cypriot government and officials from the European Union and International Monetary Fund have been going on since June but the Eurogroup has decided to delay any decision until after Cyprus's presidential elections in February. Juncker said that they hoped to be in a position to agree a loan in March.
The conditions of the next instalment of Greece's €174 billion bail-out was also discussed but no decision was taken. Finance ministers also thrashed out how they will bring into operation last year's decision by eurozone leaders to use the eurozone's rescue fund, the European Stability Mechanism (ESM), to bypass national governments to recapitalise banks directly.
The most contentious issue is whether the ESM should be allowed to fund “legacy”assets – those banks which have already received loans from governments. Both Juncker and Dijsselbloem described the issue as “technically very complex” that would need more work, Juncker said he hoped that it would be resolved within a few months.