Italy could use ESM talks to push Italian candidate to head fund: Panetta

FILE PHOTO: Senior Deputy Governor of the Bank of Italy, Fabio Panetta is seen standing in a corridor of the Bank of Italy ahead of his appointment to the European Central Bank's executive committee, in Rome, Italy. September 26, 2019. REUTERS/Remo Casilli

MILAN (Reuters) - Italy should use ongoing talks over the reform of the euro zone bailout fund, the ESM, to secure something for itself such as the appointment of an Italian to head the fund, Bank of Italy Deputy governor Fabio Panetta said on Saturday.

Panetta - who is set to become a member of the European Central Bank’s executive board - said the current reform proposals for the European Stability Mechanism did not include an automatic link between financial support and debt restructuring. He also said some elements that were unfavorable to Italy had been removed.

“If I were to lead talks on ESM, I’d try to get something in exchange,” he said. “For instance, on banking union, if there is anything that is not good for us in it, or to nominate one of our ... economists to lead the ESM, as the term of its current German boss is expiring.”

Reporting by Giulio Piovaccari; Editing by Kevin Liffey