Madrid hopes ECB appointment leads to wider EU role

Spain’s long campaign to secure at least one senior job in the main decision-making bodies of the EU is set to come to fruition this week, with its finance minister poised to secure the vice-presidency of the European Central Bank. 

Luis de Guindos is on track to win support for the job at the Eurogroup meeting on Monday, according to European officials, after intense lobbying by Mariano Rajoy, Spain’s prime minister, with German chancellor Angela Merkel and other leaders.

But while many in Brussels see the appointment as a rebalancing after six years in which Spain has had no one on the ECB’s executive board, Madrid hopes the appointment is part of a wider shift towards a more significant role in European affairs.

Now that the country has recovered from its economic crisis, which damaged its credibility in Europe and forced it to focus on its internal problems, Spanish diplomats want to play a central role in discussions about the direction of Europe post-Brexit.

“I see the French-German duo . . . as leading powers [in Europe]. This couple is very powerful, but there are more nations that should be pushing forward the European project,” said Alfonso Dastis, Spanish foreign minister, last month in a private meeting with businesses in Berlin. “Also Spain and Italy should play a major role.”

Spain is the eurozone’s fourth-largest economy with an overwhelmingly pro-European population, but it has long punched below its weight in Europe, taking a back-seat on high-level policymaking, according to Salvador Llaudes, analyst in Spain’s Elcano institute. 

Mr Llaudes says the country last played a significant role in shaping the future of the region in the 1990s. “Back then, many key European initiatives came from Spain,” he says, mentioning the European cohesion fund and the concept of European citizenship. 

In the 2000s, Spain’s foreign policy under prime minister José María Aznar became more pro-American — epitomised by Spain’s support of the Iraq war in 2003. Five years later, Spain was suffering from a dire financial crisis, requiring a bank bailout. It lost its ECB executive board seat in 2012, breaking with a tradition that France, Italy, Germany and Spain always had someone in a top role. 

Spain certainly has an opportunity to play a bigger European role. The big question is whether they are going to be able to seize it

Today, Spain lags behind its far smaller neighbour Portugal in terms of senior jobs. Portugal holds the current vice-presidency of the ECB, as well as presidency of the Eurogroup.

After a successful economic recovery that has brought the country into its fifth year of growth and a shift in foreign policy from the trans-atlanticism of the Aznar era, Spain now wants to play a bigger part in the European project. 

Spain has won some diplomatic coups of late. Last March, on the margins of a congress of fellow conservative party leaders in Malta, Mr Rajoy successfully urged European Council president Donald Tusk to make clear that Madrid would have a veto over the post-Brexit status of Gibraltar . Mr Rajoy was also invited to talks last year in Versailles with the “Big Three” on Europe’s post-Brexit future.

Many in Brussels are sceptical, however, that Spain is set to enter a new era in terms of its influence in Europe. Seasoned EU watchers say that offsetting the strong economic growth is troubled domestic politics, with the centre-right Spanish government not only lacking a majority in parliament but also reeling from the impact of the Catalan crisis.

Diplomats say Spain had to spend time and political capital making sure that European leaders supported the Spanish government against the Catalan separatists, who tried to declare independence from Spain.

Some European leaders were privately critical over how the issue was handled, particularly the use of police force to try to stop an illegal referendum on Catalan independence on October 1 last year.

Andrew Duff, president of the Spinelli group — a policy network focused on European federalism, says many in Brussels think that the government in Madrid is “looking jaded” and that this could lessen its wider influence in Europe.

Aside from Mr de Guindos, Spain also lacks big European political figures. Even Mr de Guindos — a former finance minister but not a central banker — was criticised by the European Parliament for not having the right kind of experience for the ECB role. “If Spain could find a fresh generation of leadership, it could easily be far more prominent and aspiring a player than it is at the moment,” says Mr Duff.

Pol Morillas, the deputy head of the CIDOB think-tank in Barcelona, says Spain has the chance to play a bigger role in shaping the future of Europe post-Brexit. “Spain certainly has an opportunity here to play a bigger European role. The big question is whether they are going to be able to seize it,” he said.