SHARE
COPY LINK

ECONOMY

Spain’s De Guindos in line for ECB job after Irish candidate withdraws

Irish central bank chief Philip Lane pulled out of the race for the vice-presidency of the European Central Bank on Monday, leaving favourite Spanish Economy Minister Luis De Guindos the only candidate.

Spain's De Guindos in line for ECB job after Irish candidate withdraws
Photo: AFP

Eurozone finance ministers were widely expected to pick their Spanish peer for the top job, the first of a series of changes at the ECB over the coming two years, including the post of the chief of the bank currently held by Italian Mario Draghi.

“I will be withdrawing Philip's name and I have spoken to Minister De Guindos and wished him the best of luck this evening,” Irish Finance Minister Paschal Donohoe said as he arrived for talks to fill the post with his
eurozone counterparts.   

The ministers “will make a decision tonight that will be in the best interest of the functioning and success of the European Central Bank,” he added.

The choice comes despite the scepticism of senior European lawmakers who said they preferred Lane, who is not a politician, over his rival after an informal hearing last week.

MEPs raise concerns over de Guindos as ECB candidate

EU leaders will ultimately choose the successor to Portugal's Vitor Constancio, whose eight-year mandate expires in May, as the ECB's number two.   

That decision will be taken on March 22 at an EU summit after consultations with the European Parliament and the ECB's Governing Council.   

De Guindos, a veteran of eurozone economic policy, said this month he was “convinced” he will have enough support to clinch the post after Madrid officially nominated him for the job.

De Guindos defended his candidacy, saying he was the longest-serving member of the Eurogroup, which groups eurozone finance ministers.   

He has served as economy minister since Prime Minister Mariano Rajoy's conservative government came to power in 2011.   

As economy minister he oversaw the clean-up of Spain's banking industry that collapsed after a housing boom imploded during the worst of the eurozone debt crisis.

In exchange Spain had to impose tough austerity measures to reduce the county's public deficit.

Before entering the government, De Guindos led the Iberian unit of Lehman Brothers between 2006 and 2008 before the investment bank collapsed.

ECONOMY

Spain’s middle-class youngsters the most likely to end up poor across all EU

Spain leads the ranking of EU countries with the highest risk of young people ending up in poverty as adults, despite coming from families without economic difficulties.

Spain is the fourth EU country with the highest inherited poverty
Spain is EU country with most middle-class young people who end up poor. Photo: Jaime ALEKOS / AFP

Spain is also the fourth EU country with the highest rate of inherited poverty risk, according to Eurostat, the EU Statistical Office.

Data on intergenerational poverty indicates that there is a correlation between the financial situation of the household you grew up in and the risk of being poor when you reach adulthood and in Spain, there is a strong link. 

The latest statistics available from 2019 show that the at-risk-of-poverty rate for the EU was 23 percent among adults aged 25 to 59 who grew up in a poor financial situation at home when they were 14 years old. This is 9.6 percentage points more than those who come from families without financial problems (13.4 percent). 

READ ALSO: Spain’s inflation soars to 29-year high

How the situation in Spain compares with the EU

Spain has become the EU country with the highest risk of poverty among adults who grew up in families with a good financial situation  – 16.6 percent.

This was followed by Latvia with 16 percent and Italy with 15.9 percent.

That statistics also show the countries where it is less likely to be poor after growing up in households without economic difficulties. These include the Czech Republic (5.9 percent), Slovakia (7.9 percent) and Finland (8.5 percent).

The overall poverty rate in the EU decreased by 0.1 percentage points between 2011 (13.5 percent) and 2019 (13.4 percent), but the largest increases were seen in Denmark (1.9 points more), Portugal (1.8 points), the Netherlands (1.7 points) and Spain (1.2 points).  

On the other hand, the biggest decreases in the poverty rate were seen in Croatia (-4 percent), Lithuania (-3.6 percent), Slovakia (-3.5 percent) and Ireland (-3.2 percent).

READ ALSO: Spain’s government feels heat as economic recovery lags

Inherited poverty

The stats revealed that Spain was also the fourth country with the highest rate of inherited poverty risk (30 percent), only behind Bulgaria (40.1 percent), Romania (32.7 percent) and Italy (30.7 percent).

This means that children of poor parents in Spain are also likely to be poor in adulthood. 

The countries with the lowest rate of inherited poverty risk were the Czech Republic (10.2 percent), Denmark (10.3 percent) and Finland (10.5 percent).

The average risk-of-poverty rate for the EU increased by 2.5 percentage points between 2011 (20.5 percent) and 2019 (23 percent), with the largest increases seen in Bulgaria (6 points more), Slovakia and Romania (4.3 points), Italy (4.2 points) and Spain (4.1 points).

The biggest drops were seen in Latvia (-8.5 points), Estonia (-8.0 points) and Croatia (-2.3 points). 

The largest gaps in people at risk of poverty when they reach adulthood were in Bulgaria (27.6 percentage points more among those who belong to families with a poor economic situation as teenagers compared to those who grew up in wealthy households), Romania (17.1), Italy (14.8), Greece (13.5) and Spain (13.4).

SHOW COMMENTS