Spain could hold presidency of eurozone rescue fund

(SAARISELKAE) - Spain appears well-placed to obtain the presidency of the eurozone's permanent rescue fund ESM amid a redistribution of top posts in Europe, a European official told AFP Sunday.

"It's a real possibility," a source speaking on condition of anonymity said on the sidelines of an informal meeting of senior European officials in northern Finland.

The European Security Mechanism aims to prevent the eurozone debt crisis spreading throughout the 17-nation eurozone when it begins operating in July.

Until recently it had been understood that Germany's Klaus Regling, the current president of the temporary rescue fund the European Financial Stability Facility (EFSF), would head the ESM as of July.

But Germany has pushed for its Finance Minister Wolfgang Schaeuble to become the next head of the Eurogroup when the mandate of Jean-Claude Juncker of Luxembourg expires this summer.

Given Germany's status as an economic heavyweight, Schaeuble is well-placed to head the forum of eurozone finance ministers, two eurozone officials speaking on condition of anonymity said.

"He's the favourite," one of them said.

But if that is the case, it would be difficult for Germany to also hold the presidency of the ESM.

Spain has meanwhile been eyeing the post. Madrid has also sought a position on the board of the European Central Bank (ECB), but has little chance of obtaining it, as it is seen going to Yves Mersch of Luxembourg.

"There are two possibilities," one of the officials said.

"Either Schaeuble becomes the next Eurogroup president and Spain can expect to get the ESM presidency as compensation. Or Juncker remains president of the Eurogroup and Spain will get the ECB job because Luxemburg can't realistically hope to have the two positions at the same time," he said.

Spain's secretary of state for the EU, Inigo Mendez de Vigo, attending the talks in Finland, would not be drawn on the negotiations underway.

"I can tell you that at the end of the day we won't be the loser, let's see how things develop," he told reporters.

"In a family sometimes you do not get everything you want but at the end of the day you have to feel comfortable and I'm sure the Spanish position at the end of the day will feel comfortable," he said.