Joerg Asmussen is likely to bring a more pragmatic approach to the European Central Bank board than the man he replaces and his appointment may mark the end of an era of uncompromising German central bankers fixated on one goal alone -- fighting inflation, according to Reuters. Even people who know him well say Asmussen is an enigma when it comes to monetary policy. Just 44, he has climbed the ladder at the German finance ministry with astonishing speed, rising from a junior adviser role in 1996 to deputy finance minister 12 years later. What former colleagues do highlight is his competence and calm under pressure. For the past three years, he has been one of the key protagonists in Berlin's response to both the global financial crisis and euro zone debt crisis. His intricate knowledge of international economic and financial issues, from banking and regulation to bailouts, led Finance Minister Wolfgang Schaeuble to keep him in the second highest position at the ministry after the 2009 election, despite the fact that he is a member of the opposition Social Democrats (SPD). Since then he has acted as Germany's G20 sherpa and represented Europe's largest economy at major international financial summits, substituting for Schaeuble when he was in hospital for weeks at a time in 2010. But in his current role, Asmussen has been more of a backroom negotiator and problem solver than public policymaker, pushing the official German line rather than speaking out about his own views. "Exactly how he will think and act is not quite clear yet," said Manfred Neumann, an emeritus professor of economics who advised current Bundesbank President Jens Weidmann on his doctoral thesis and also knew Asmussen as an economics student in Bonn. "Personally I believe he is more of a hawk than a dove though I imagine he'll take on a mediator position," Neumann said. "But it'll be more about individual questions for him." SPD SUSPICION Juergen Stark, whose position on the ECB's executive board Asmussen will take, is a monetary hardliner in the orthodox German tradition. Angered by the bank's controversial bond-buying programme designed to prop up weak euro zone states, he is stepping down nearly 2-1/2 years before his term was due to end. That move follows the abrupt departure of Bundesbank chief Axel Weber seven months before for the same reasons. Together, the resignations have highlighted just how isolated the German inflation hawks had become on the ECB board. Suspicious about his SPD affiliation, some German conservatives fear Asmussen could play into the hands of policy doves from southern Europe, accepting crisis-fighting measures like bond buying that traditionalists reject outright. "He certainly has the standing, the profile to do the job," said Klaus-Peter Willsch, a parliamentarian from Chancellor Angela Merkel's Christian Democrats (CDU), who has opposed some of the government's measures to save the euro. "But I do have my doubts about whether he will play the same role in defending the policy of monetary stability that (former ECB chief economist Otmar) Issing, Stark or Weber stood for." Heiner Flassbeck, a former deputy finance minister for whom Asmussen worked early in his career, once called him "mediocre" and not fit for higher office. "He has no clear profile," Flassbeck told Reuters. "I have never heard anything from him about monetary policy -- neither in the time I worked with him, nor afterwards." Back in 2007, Asmussen came under fire for his links to Duesseldorf-based lender IKB. He was on the bank's supervisory board when it nearly collapsed due to disastrous investments in U.S. subprime mortgages. No wrongdoing was ever proven and Asmussen has said he was kept in the dark about the bank's activities. Others who have worked with Asmussen, a slim, shaven-headed man from the northern city of Flensburg near Denmark, sing his praises. Some expect him to defend traditional German stances once he lands in Frankfurt, much as Weidmann -- Merkel's former economic adviser -- has done since moving down from Berlin to head the Bundesbank in May. Both students of Weber in Bonn and only 1-1/2 years apart in age, Asmussen and Weidmann worked closely together over the past three years in shaping Germany's financial crisis response. The firefighting was so intense at times that Asmussen missed the birth of his second daughter. When Weidmann was appointed, there were also doubts about whether he would take as hard a line as his predecessor Weber and be able to distance himself from Merkel. Those fears have been largely allayed in his four months atop Germany's central bank. "He's a hawk in a dove's clothes," Otto Fricke, a budget expert with the Free Democrats, Merkel's junior coalition partner, said of Asmussen. "In questions of the euro, party membership can't be the deciding factor. It's competence." Walther Otremba, a former deputy economy minister and long-time associate of Asmussen's told Reuters that his expertise was "undisputed" but added: "The question is, will he change with the new job?"
