Portugal's Mario Centeno Chosen to Lead Eurozone Finance Ministers -- Update

By Todd Buell in Brussels and Jeannette Neumann in Madrid Features Dow Jones Newswires

European Finance Ministers on Monday shifted power from the north of the continent to the south, providing a boost to opponents of austerity policies.

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They chose Portugal's Finance Minister Mário Centeno to lead the group of finance ministers, known as the Eurogroup, which steers policy in the eurozone. Mr. Centeno's peers elected him to succeed former Dutch Finance Minister Jeroen Dijsselbloem as president of the group, which plays an essential role in important eurozone policy discussions, such as those pertaining to Greece's bailout.

The press office of the European Council said in a Monday Twitter post: "#Eurogroup just elected Mário Centeno, Minister of Finance of Portugal, as its new President. He will take office on 13 January 2018."

Mr. Centeno has been Portugal's finance minister since November 2015, when Socialist leader António Costa was appointed prime minister. Since then, the 50-year-old Mr. Centeno has helped to oversee Portugal's continued recovery from a crisis-era bailout. Unemployment has fallen and once-teetering banks in Portugal, a country of 10.3 million inhabitants, have generally stabilized. Credit-rating firm Standard & Poor's raised Portugal's debt to investment grade from junk in mid-September.

Opponents of austerity policy welcomed the selection of Mr. Centeno, whose country has in recent years rejected the spending cuts often pushed by European authorities and northern European countries. Sven Giegold of the Green group in the European Parliament, said that Mr. Centeno was the "anti-Schäuble among Europe's finance ministers," a dig at former German Finance Minister Wolfgang Schäuble, a staunch advocate of balanced budgets.

"Portugal has successfully refuted the austerity dogma. Centeno has shown that, after the necessary structural reforms, investing is the right way forward. The country is recovering not in spite of the fact that it is raising pensions and incomes, but because of it," Mr. Giegold said.

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Mr. Centeno could face a problem at home, however. Two parties maintaining his government are euroskeptic. Asked about this at a press conference Monday, Mr. Centeno ducked, saying that in his capacity as president-elect of the Eurogroup it wasn't appropriate for him to discuss domestic questions. "Domestic policies are addressed domestically," he said. He added it was the "firm determination" of the Portuguese government "to contribute to the construction of the European Union and of the eurozone. We will continue in this vein."

Mr. Centeno was an economist at Portugal's central bank from 2000 to 2004, when he was appointed deputy director of the bank's economic studies department, a post he held until 2013. He then served as an adviser to the Bank of Portugal's board of directors. From 2004 to 2013, he was a member of the European Commission's economic policy committee, according to his official biography.

Mr. Centeno completed a Ph.D. in economics in 2000 from Harvard University, where he also earned a Master of Science in economics.

--Patricia Kowsmann in Frankfurt contributed to this article.

Write to Todd Buell at todd.buell@wsj.com and Jeannette Neumann at jeannette.neumann@wsj.com

(END) Dow Jones Newswires

December 04, 2017 14:12 ET (19:12 GMT)