Pierre Gramegna

Pierre Gramegna, former Luxembourg finance minister and managing director of the European Stability Mechanism, on Tuesday called for bolder steps towards creating better integrated financial markets in Europe. Reviving the EU’s ambition for creating a true Capital Markets Union is essential, he said, if Europe wants to broaden access to finance for businesses and achieve its sustainability ambitions.

The exact arrival dates of the Financial Action Task Force on-site assessors in Luxembourg remain a secret, so expect them to arrive anytime soon. The two weeks these unnamed individuals will spend this month in Luxembourg are just a fraction of the 18-month audit to which Luxembourg’s anti-money laundering rules and practices are currently undergoing. 

Eurogroup finance ministers on Monday again failed to agree on naming the successor for Klaus Regling as chief of the European Stability Mechanism even after Italy withdrew the candidacy of European Commission official Marco Buti.

Neither the Luxembourg nor Portuguese candidate managed to win the required 80 percent majority in the vote that followed Italy’s withdrawal. Eurogroup president Paschal Donohoe said that the next vote now will take place in September. Regling is set to retire in October.

After two rounds of voting three candidates remained in the race on Monday night for the position of director-general of the European Stability Mechanism. Luxembourg’s candidate Pierre Gramegna, a former finance minister, will have to win the support from southern European countries if he is to succeed Klaus Regling in October. A decision now is expected at the 16 June Eurogroup meeting in the Grand Duchy.

Luxembourg, Italy, Portugal and the Netherlands have all put forward candidates to succeed Klaus Regling as the head of the European Stability Mechanism, the 500-billion-euro eurozone bailout fund known as ESM. On Monday, the Eurozone finance ministers are due to decide on a successor for Regling, who steps down after a ten-year tenure and leaves behind a legacy at the Luxembourg-based ESM.

That a global minimum corporate tax rate is being perused by the Biden administration is a revolution. Yet it raises questions about whether this desire can be translated into effective policy. Moreover, it is unclear what would be the impact on the attractiveness of places like Luxembourg as a hub for multinationals.