Paschal Donohoe elected as President of the Eurogroup

The euro area entered a recession of unprecedented depth in the second quarter

Photo: EU Paschal Donohoe.

Irish Finance Minister Paschal Donohoe was elected as President of the Eurogroup, the group announced on Thursday evening. The other candidates for the position were the finance ministers of Spain - Nadia Calviño, and of Luxembourg - Pierre Gramegna.

The new president succeeds Mário Centeno, the third permanent Eurogroup President, who was elected in December 2017.

He will take office as of 13 July and will serve a two and a half year term. The first Eurogroup meeting under Donohoe's presidency is sceduled for 11 September.

As I begin my tenure as President of the Eurogroup, I'm deeply conscious that citizens of Europe are looking at where their national economies now stand, are looking at the European economy and have become concerned for their futures, their jobs and their incomes, Donohoe commented after his election. I'm absolutely confident that with my colleagues in the Eurogroup with have the ability and we have laid the foundations to overcome these challenges and to prevail, he added.

At his last press conference as President of the Eurogroup outgoing Eurogroup President Centeno informed about the discussion of the economic situation that the finance ministers of the Eurozone held on Thursday. During the sitting the Commission presented its interim summer forecast, which confirms that The euro area entered a recession of unprecedented depth in the second quarter.

The forecast also confirms that the rebound has started, though it is far too early to relax and the euro area economy is expected to shrink by almost 9% this year and, even if the rebound continues next year, as we hope, we will still be far below where we were, Centeno specified.

He said: “It rests on our shoulders the task to prove part of these bleak projections wrong. These forecasts do not factor-in the impact of the Recovery Instrument. A timely agreement at the European Council on a robust recovery plan would surely constitute an upside risk. And so the policy response to the pandemic remains our prime focus.”

For next year, uncertainty remains very high, he stressed noting that "the policy challenges may change in the coming months and our policy responses may have to adapt". As ministers gear up their budget preparations for next year, there is broad consensus on supportive policies for next year as well, Centeno added.

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