FRANKFURT: The European Central Bank (ECB), in addition to the many monetary policy challenge it faces next year, will see some major changes in the way it is run next year.
Here are the main operational adjustments the ECB faces from January 1:
With the arrival of Lithuania as the eurozone’s 19th member state, a new voting system will come into operation on the ECB’s policy-setting governing council.
Since the ECB took over the monetary policy reins for the euro area, the council has had a one man-one vote system under which each of the six members of the ECB’s executive board and each national central bank governor has one vote.
But with the prospect of more and more countries signing up to the single currency, a new system was agreed back in 2003 whereby once membership exceeded 18 states, a system of rotating votes would be introduced to prevent the decision-making process from becoming too unwieldy.
So, with Lithuania joining the single currency bloc on January 1, this new system will come into effect.
From then on, the eurozone’s five biggest economies — France, Germany, Italy, the Netherlands and Spain — will share four votes, and the other 14-member states will share 11 votes.
That means that in one out of every five meetings, Germany, Europe’s paymaster, will not have a vote in any ECB decisions.
Officially, neither the German government nor the country’s central bank, the Bundesbank, is fazed by such a prospect.
And insiders and ECB watchers insist that little will actually change, anyway.
The ECB itself points out that even if an individual governor will not actually have a vote, all central bank chiefs will continue to participate actively in the meetings and make their voice heard in every debate.
And anyway, the ECB traditionally likes to reach its decisions by consensus, rather than putting them to a vote. Reuters