World Crisis Online

With Axel Weber out of consideration as the next European Central Bank chief, the top German candidate for a job once all-but-promised to Berlin is an economist who already has a position in the high reaches of Europe’s financial bureaucracy.

Klaus Regling, 60, has repeatedly said he is content to stay in his current post as head of the eurozone’s €440bn ($600bn) rescue fund, the European financial stability facility that was created last year to bail-out countries cut off from the financial markets.

“I’ve got a great job,” he said again on Wednesday.

But senior European officials said he has become the only serious German candidate and that his chances were dependent on whether Angela Merkel, the German chancellor, pushed for him. “I don’t sense the Germans are that desperate to put him there,” said one official.

Although he rose to prominence working on creating Europe’s monetary union at the German finance ministry in the 1990s, he spent most of the 1980s at the International Monetary Fund in Washington and Jakarta.

There are other hurdles to his candidacy, officials said, including the fact he has never been a central banker and is seen as essential to maintaining stability at the EFSF at a time when an overhaul of the fund is under consideration.

In addition, some see many of the same issues that Mr Weber faced. “Both of them are too hawkish for the other euro area countries,” said a senior official at a eurozone finance ministry. “The French and other countries feel the ECB did too little during the current crisis.”Still, Mr Regling backed the controversial ECB decision last May to buy sovereign bonds of struggling “peripheral” economies and is known to support more pragmatic positions on ECB policy than Mr Weber.

Moreover, the French government is believed to want a German at the ECB helm to ensure Germany is deeply involved in resolving the current crisis, a tie that could be weakened without a German at the head of any major eurozone institution.

Mr Regling is not close to Ms Merkel, having spent significant portions of his career outside Germany. Before taking charge of the Luxembourg-based EFSF, Mr Regling spent seven years as head of the European Commission’s economic directorate, where he developed close ties to potential supporters in several other eurozone countries.

Last year, for example, he was tapped by the Irish government to co-author an inquiry into the collapse of the Irish banking sector. The report damned Irish regulators and found that the crisis was “homemade” and not the product of the global financial meltdown.