By approving the draft report by Irene Tinagli (S&D, Italian) by 30 votes to 3 with 2 abstentions on Monday 9 October, members of the European Parliament’s Committee on Economic and Monetary Affairs (ECON) gave their backing to the appointment of Piero Cipollone as a member of the Executive Board of the European Central Bank (ECB) to replace his compatriot Fabio Panetta (see EUROPE 13239/18). The ECON Committee will prepare a proposal for a Parliament recommendation, which should be put to the vote at the plenary session to be held from 16 to 19 October.
The ECB’s Governing Council had already indicated on Wednesday 27 September that it was in favour of the Italian’s appointment (see EUROPE 13259/20).
It will be up to the European Council to formalise this appointment for a non-renewable eight-year term.
Inter-institutional relations
Piero Cipollone, who had already provided written answers included in the draft report, expressed on several occasions to the members of the ECON Committee his wish, if appointed, to maintain a frank and open dialogue with the members of the European Parliament. He has undertaken to appear before the parliamentary committee at its request.
The candidate for the Executive Board felt that dialogue with the European Parliament was important in order to hear the representatives of Europe’s citizens and convey messages to Europeans.
However, Eva-Maria Poptcheva (Renew Europe, Spanish), Fulvio Martusciello (EPP, Italian) and Johan Van Overtveldt (ECR, Belgian), in particular, expressed their concern that the ECB was not always listening enough. Mr Cipollone replied that he would bear this comment in mind.
Excessive liquidity
Asked by Johan Van Overtveldt about excess liquidity, Piero Cipollone said, as Christine Lagarde had (see EUROPE 13257/16), that the ECB was ahead of other central banks which had previously also adopted quantitative easing. He indicated that the end of reinvestments under the Asset Purchase Programme (APP) and the repayments by banks of loans obtained under the third round of long-term refinancing operations (TLTROIII) would reduce the volume of excess liquidity and that 500 billion would still have to be repaid by banks.
A study on the optimal size of liquidity in the Eurosystem is currently underway.
In addition, the candidate called for caution on the road to this optimum size.
Secure assets
Mr Cipollone told Antonio Maria Rinaldi (ID, Italian) that a safe asset could facilitate monetary policies. He felt that it would be important, in a future crisis, to have a mechanism for coordinating the right fiscal stance across Europe, as it would then be much easier to coordinate monetary policy.
Digital Euro
Responding to Jonas Fernandez (S&D, Spanish), Mr Cipollone, who is a member of the Eurosystem’s high-level task force on central banks’ digital euro, stressed that all citizens’ concerns had to be examined and that a solution had to be found, in particular, to concerns about respect for privacy.
The candidate for the Executive Board felt that a digital euro would be an inclusive means of payment and would strengthen Europe’s strategic autonomy by enabling payments throughout Europe using European infrastructures and technologies.
Climate change
Finally, Piero Cipollone felt that climate change would have an impact on the ECB’s ability to conduct its monetary policy, as it would affect its ability to predict the dynamics of inflation and its ability to preserve the balance sheet, which is affected by the risk induced by climate change.
He therefore felt that the ECB’s core mandate (price stability) was essential if it was to make the best possible contribution to the well-being of citizens.
Mr Cipollone affirmed that the ECB could and should combine all its tools in order to deal with the entire economic and financial situation, and that in pursuing its primary mandate, the ECB was also working on its secondary mandates.
Link to the draft report: https://aeur.eu/f/8yo (Original version in French by Émilie Vanderhulst)