MILANO – Fabio Panetta will be the new governor of the Bank of Italy: in November will replace Ignatius Visco which has been in office since 2011 and is no longer eligible for re-election after two terms. The Council of Ministers has started the process for the appointment which in its formulation is quite complex, precisely with the aim of safeguarding the independence of the central bank as much as possible.
In fact, it is necessary to get to the nomination a decree of the President of the Republicon the proposal of the Prime Minister, following a resolution by the Council of Ministers, having heard the Superior Council of the Bank of Italy (made up of 13 members).
In practice, the Council of Ministers usually chooses from a list of names prepared by the Superior Council, which selects figures with sufficient technical characteristics. And about Panetta, who completed his entire career within Bank of Italy up to holding the position of general manager and then he went up to Frankfurt as the Italian representative of the Executive Committee of the ECB, where it still sits, the Superior Council expressed a unanimous positive opinion. Thus the Council of Ministers on Tuesday afternoon was able to deliberate on his appointment as governor of the central bank starting from 1 November 2023, and at this point the decree will be submitted for signature by the President of the Republic.
So politics enters the nomination decision but in a mediated manner, being cushioned on the one hand by a technical body that represents the continuity of the Bank of Italy and on the other by the signature of the Head of State who ensures that everything has been done with the due procedures.
If the government has decided to bring Panetta back from Frankfurt, it will then have to deal with his replacement on the Executive Committee of the ECB. And here the procedure extends to the policy of the European states as it must be approved by the Eurogroup. Therefore a negotiation could open and Italy could not have the stick on the side of the handle since has not yet approved the Mes (European Stability Mechanism), unique in Europe. On the other hand, it has never happened so far that Germany, France and Italy were not represented within the Executive Committee of the ECB. It happened only in Spain and for a limited period of time.