The Euro Zone
EU-mad Romano Escolano, Spain's incoming economy minister, is already showing where his priorities lie. Even though his predecessor, Luis de Guindos, does not officially take up his position as vice president of the European Central Bank (ECB) until June, Escolano has already started work, telling a conference in Madrid this week that the EU needs a shared banking deposit scheme. This would be a way, he said, of bolstering the bloc's (and Spain's) banking sector as well as assuring savers that their money is safe, regardless of where it's held.
What about reducing unemployment, especially youth unemployment? What about the pensions problem, which recently sparked nationwide protests? What about shrinking Spain's public debt, which currently stands at 100% of GDP? What about passing an already absurdly delayed 2018 budget? All that can wait, it seems. Escolano, outgoing vice president of the European Investment Bank, is more concerned that Spain and his beloved EU become even closer than they are at present.
This shouldn't be a surprise. Spain has been campaigning for increased financial homogeny within the EU and the Eurozone for some time. In this respect, Escolano is picking up from exactly where his predecessor left off - or will leave off in June, when he leaves front-line politics to take up a cushy EU job in Frankfurt.
Last February, the Spanish economy ministry sent a document to Brussels in which it argued for a common banking union for all Eurozone members, a shared unemployment scheme and mutualised debt. The proposals were greeted with raised eyebrows by more powerful EU players; indeed, France and Germany have said repeatedly that they want the bloc's weaker economics and banking sectors to become stronger before any such moves are considered.
A few months after the Spanish government called for greater fiscal integration in the EU, its economy minister reinforced the message in an interview with the UK's Financial Times. De Guindos told the newspaper that the EU's survival depended on greater financial unity and its executive bodies being given more control over member states' economies. All the while, you imagine, with an eye on the powerful EU job he has since secured.
Escolano, a committed member of the EU elite, is clearly reading from the same script as his predecessor. He said this week that the possibility of a common bank deposit scheme should be top of the agenda at an upcoming EU summit in June. By which point, of course, De Guindos will be installed as ECB vice president and eager to push Spain's proposals for greater fiscal integration within the EU. He'll also be well placed to respond to the country's request that EU bosses are handed greater power over member states' economies. Convenient, that, as the request came from none other than De Guindos himself.