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Eurogroup’s session in Brussels this Monday confirmed Croatia’s Boris Vujčić as the successor to Spain’s Luis de Guindos, whose eight-year mandate at the ECB expires in May.
While the nomination must still undergo consultative hearings at the European Parliament, and a review by the ECB’s Governing Council, this process is mostly protocol.
Vujčić is expected to take office on 1 June and become Christine Lagarde’s right-hand man.
The decision defied predictions and dismissed the European Parliament’s recommendations.
The Croatian beat five other candidates for the job, including the favourite to win, Finland’s Olli Rehn, and the Parliament’s favoured choices, Portugal’s Mário Centeno and Latvia’s Mārtiņš Kazāks.
Following the meeting, the president of the Eurogroup, Kyriakos Pierrakakis, said there was “an agreement on both the process and the person which is a sign of institutional maturity on the background of an exceptional number of candidates and past experiences”.
For Croatia, the promotion of its central bank governor to the ECB’s Executive Board is a swift ascent. The country only adopted the euro in 2023 and is the second-newest member after Bulgaria, which integrated the single currency at the start of this year.
Croatia’s infancy in the eurozone stands in stark contrast to the veteran status of the man who shepherded the nation through its transition.
Currently serving his third term, Vujčić has led the Croatian National Bank since 2012, playing a key role in negotiating the country’s accession to the EU in 2013 and overseeing the adoption of the euro a few years ago.
A “moderate hawk”
The ECB vice president makes a substantial contribution to the Governing Council’s financial stability analysis, influencing interest rate decisions, and also substitutes the President whenever necessary.
In the technical jargon of central banking, Vujčić is frequently classified as a “moderate hawk”.
Vujčić is a seasoned economist who has repeatedly cautioned against lingering inflation threats, pushing for a slow and measured reduction in interest rates to guarantee that price stability is firmly reinstated.
However, the Croatian’s colleagues have also previously described him as pragmatic, data-driven, and relatively predictable.
The Eurogroup likely sees Vujčić as someone who will not focus on political optics and instead help the ECB steadily navigate the tail end of its post-pandemic inflation fight.
The great reshuffle of the ECB
Despite Vujčić’s appointment being meaningful for Croatia, the vice presidency is not among the most desired roles in the ECB.
In fact, the EU’s major member states did not even propose candidates for this nomination, as they prepare for the many seats that become vacant next year.
The positions of president, chief economist, and head of market operations, will all be available in 2027.
The EU’s “big four”, Germany, Spain, France and Italy, are all expected to compete for those spots, aiming to preserve their controlling influence over the ECB.