Brussels – a senior official said EU leaders confident will appoint Mario Draghi, Presidency of the European Central Bank at their summit Friday — a move that would give investors some certainty over who will lead the institution in its role against Europe to paralyse the debt crisis.
The timing of the appointment of Dragons were came under doubt as fellow Australian Executive Board Member Lorenzo Bini Smaghi has so far refused to leave his post. But until their next meeting in September would have highlighted divisions between EU leaders, delaying the appointment, who struggled to find a common line on debt-stricken Greece and the best way to contain the financial crisis that has forced Ireland and Portugal also in need of massive bailouts.
The concern of Paris was that France would not have a representative on the Executive Board of the ECB once the current head of the ECB Jean-Claude Trichet departs on 31 October. The French had previously implied that it would support only Dragons if a French or a woman takes the place of Bini Smaghi.
The official did not say how the differences would be ironed out. He spoke on condition of anonymity because the decision was not final.
Another European official has also said the appointment of Dragons probably would come on Friday.
The ECB has played a central role during the debt crisis that has plagued the eurozone 17-country over the past 18 months or so. For example, Trichet ignored criticism from some of the more hawkish officials at the Bank, when he advocated a program of buying bonds multibillion euro intended to ease the pressure on the most indebted countries.
The ECB has provided massive amounts of liquidity for European banks since the beginning of the financial crisis.
More recently, the ECB found himself in a difficult position to raise interest rates to keep a lid on inflation above target even if euro-zone economies weaker remain weak.
The decision on Dragons is expected a day after EU leaders gave their clearest sign yet that Greece will get a second bailout in coming weeks, on top of euro110 billion last year.
"We agreed that there will be a new program for Greece," said German Chancellor Angela Merkel.
The strongest language on aid for Greece was also made possible debt after inspectors from the EU and the International Monetary Fund has reached a final agreement with the Government Thursday in Athens, the value of euro28 billion for new austerity measures.
Measures must be approved by the Greek Parliament, next week for bailout funds be released. If lawmakers do not back the package, then Greece will probably be setting a default on its debts.
Even if it gets a second rescue plan, many economists believe that Greece will have to restructure its debts in some form or in the coming years, especially if the economy shrinks further.
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Angela Charlton contributed to this story.
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