Euro finance ministers to weigh economic reform

European finance ministers will discuss ambitious plans to achieve greater prosperity in the euro zone and tackle a key vacancy…

European finance ministers will discuss ambitious plans to achieve greater prosperity in the euro zone and tackle a key vacancy on the board of the European Central Bank when they meet in Brussels tonight.

Amid much scepticism, their goal for the region to be the most competitive economy within a decade is under scrutiny ahead of a summit in Barcelona designed to push the process ahead.

Another sensitive topic will be the selection of a replacement for ECB Vice President Mr Christian Noyer, whose four-year term expires on May 31st.

This creates the first opening on the ECB's executive board and will be an opportunity for horse-trading that some fear may tarnish the bank's reputation for independence.

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Greek Central Bank governor Mr Lucas Papademos has emerged as a popular choice among his peers, but the choice will be made by politicians, who are keeping their cards covered.

EU diplomats said that the ECB job vacancy would be kept to the sidelines of the meeting, but was sure to be discussed.

"The main point will be the broad economic policy guidelines - the ECB issue was not discussed at preparations for these meetings and it is not on the agenda," said one EU diplomat.

"But the point will come up at Barcelona, so while it is not there on the agenda, even informally, they (finance ministers) can always discuss it, in the lavatories if nowhere else."

Several central bankers tipped for the post have ruled themselves out, including Belgian Central Bank Governor Mr Guy Quaden and Portugal's Vitor Constancio.

Some politicians favour a deal tying up the Noyer succession with the replacement of ECB President Mr Wim Duisenberg and executive board member Mr Sirkka Hamalainen, who both step down in the middle of next year.

Finance ministers will also plot strategies to reform labour markets, by looking into ways to increase the number of people on the job registers, and review progress in integrating Europe's market for financial services.

The European Commission's idea of creating a subsidiary of the EIB is already a climbdown from a plan for a separate institution to help the EU's poor southern neighbours.