The clash of European concepts regarding central bank independence: The Franco-Germanic (“Latin-Teutonic”) dispute on the ECB’s role during the euro crisis

The global financial crisis – which, in the European Union, has further transformed into the EU sovereign debt crisis (the euro crisis) – has shaken the foundations of the Economic and Monetary Union as established in 1992, particularly regarding the stabilising role of the European Central Bank (ECB). As a result, two blocks of countries emerged: the first consisted of the northern eurozone countries (less affected by the crisis), which advocated for strict ECB independence and the continuation of its limited price stability mandate (“the Teutonic block”); the second included the southern eurozone countries, which suffered great difficulties in acquiring financing for their public debts and called for the ECB to take a more politically active role. This paper argues that such contradictory approaches are inevitable in a heterogeneous entity like the European Union (specifically, the eurozone) and need not necessarily undermine the future of the eurozone as a whole. Indeed, the 50 years of European integration led by the Franco-Germanic engine indicate that such different standpoints are nothing extraordinary. The remaining challenge is to transform them into ‘productive tension’ to keep the European project on the move.