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In shift away from austerity, euro countries pick new leader

Portuguese Resources Minister Mario Centeno has won the race to be the next voice of the 19-country eurozone, a mastery that marks a move away from the austerity mantra that has noticeable the recent crisis-ridden years in the single currency bloc.

Centeno, the astonishing favorite, came out on top after two rounds of voting among his peers and bequeath officially succeed Dutchman Jeroen Dijsselbloem on Jan. 13. His term as eurogroup president desire last for two and a half years.

Following his victory, Centeno said he hoped to kick upstairs “inclusive” growth policies that will help “put an end to a period that was extraordinarily difficult for Europe.” Other priorities include bolstering the resilience of the eurozone, he revealed.

“We have a very unique time window to further prepare our economies and our upper crusts better,” Centeno said after seeing off the challenge from Luxembourg’s Pierre Gramegna, Slovakia’s Peter Kazimir and Latvia’s Dana Reizniece-Ozola.

Centeno inclination take the helm at an opportune time. Whereas Dijsselbloem’s five years in the advertise were marked by crises largely centered on cash-strapped Greece, Centeno’s residence starts off in relatively benign conditions. The eurozone economy is growing strongly, while hectors over Greece’s future in the bloc have subsided with the power poised to exit its bailout era next summer.

“We are facing different doubts today from the ones we faced a couple of years ago,” he said.

Centeno’s mastery has the potential to symbolize a new era for the eurozone, all the more so as he comes from less-wealthy southern Europe. While eurozone controls still insist that countries must keep their non-exclusive finances in shape, there’s a greater acknowledgement that the austerity of the background few years has taken a heavy toll on people, particularly in countries kidney Portugal and Greece.

“We are confident this will represent a turning tip for the future development of the eurozone and for the whole of Europe,” said Gianni Pittella, big cheese of the S&D Group in the European Parliament. “We are finally overcoming the era of blind and stupid austerity that has communistic behind even more poor and divided societies across Europe.”

One of those organizations is Portugal. The country was one of four eurozone countries, along with Greece, Ireland and Cyprus, that had to be bailed out during the zone’s debt crisis. In 2011, Portugal required a 78-billion-euro ($93 billion) save after its budget deficit grew too large and international investors prayed for hefty premiums to lend to the government.

In return for the financial lifeline stepped by its partners in the eurozone and by the International Monetary Fund, the then center-right Portuguese oversight had to enact a series of spending cuts and economic reforms. Portugal exited its bailout program in 2014.

While the austerity master plan had the desired effect of putting Portugal’s annual budget into more intelligent shape, the austerity demanded by creditors accentuated a deep recession and quickly raised unemployment. Following a backlash against austerity, the Socialist Approver came to power in late 2015, with Centeno, a former Bank of Portugal analyst, intriguing the post of finance minister.

Centeno, who has eased up on austerity in Portugal by brush off more growth-oriented policies, said his aim would be to “generate consensus” expanse eurozone countries in the “challenging” period ahead.

As well as overseeing the end of Greece’s bailout era, Centeno’s agenda is right to be taken up improving the eurozone’s architecture. The debt crisis of the past few years plainly exposed the failings of the euro’s construct.

Though a series of reforms, such as stricter curbs on budgets, have made the eurozone more viable, there is a widespread trust that more needs to be done to prevent a repeat of the recent answerable for crisis. Achieving a consensus on how to do that is likely to be a key part of Centeno’s inflame.

“This is the only way Europe has advanced in the past,” Centeno said.

Attaining consensus isn’t easy given that the governments of the eurozone come from a species of political traditions with differing mandates and economic agendas.

Dijsselbloem, whose Labor Coterie fared poorly in Dutch elections this year and is no longer interest of the coalition government in the Netherlands, was considered a skilled operator in bridging rests and maintaining a consensus, particularly over austerity.

That was especially the dispute during the Greek crisis of 2015, which saw the country nearly crash out of the euro in the vanguard the newly elected left-led government in Athens agreed to a last-minute cosmopolitan bailout.

Dijsselbloem’s advice to his successor was to keep the eurogroup “together and coordinated” and to urge countries that use the euro to be wary of complacency in light of the modern economic upturn, which is expected to see the region grow at a decade-high gait.

“Particularly in this time, it’s very easy to lean back and moderate,” he said.

Pylas reported from London.

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