Tough times

Mario Draghi will have his work cut out for him when he takes over the leadership of the European Central Bank (ECB) this October from Jean-Claude Trichet.

Speaking before Draghi's official nomination by eurozone finance ministers Tuesday, Luxembourg Prime Minister Jean-Claude Juncker spoke of the eurozone's "quasi-catastrophic" economic situation.

According to The Wall Street Journal, the ECB now owns 77 billion euros ($109 billion) of "some of the dodgiest eurozone sovereign debt money can buy."

Draghi, who currently heads Italy's central bank and fought against Greece's 2010 financial bailout, is expected to oppose debt restructuring for the currency bloc's ailing member countries.

Winning over Germany

Draghi's nomination resulted from a months-long struggle to get German skeptics on board with his candidacy. Germany had been reluctant to choose him even after it's only hope for the position, former Bundesbank President Axel Weber, dropped out of the race by declaring early retirement.

The German press first worried about having an Italian running the ECB. However, the Bild tabloid, which first claimed inflation was as natural for Italians as "tomato sauce with spaghetti" later adopted Draghi as an "honorary German."

Other countries threw their weight behind Draghi early on, but German Chancellor Angela Merkel only expressed her support for the Italian last week.

France, by contrast, had been one of the first countries to get behind Draghi, whose candidacy for the position was unchallenged.

"France will be very happy to support an Italian at the presidency of the European Central Bank," French President Nicolas Sarkozy said at a news conference in Rome last month.

"We aren't supporting him because he's Italian. We're supporting him because he's an excellent candidate," he added.

'Super Mario'

Sometimes referred to by the press as "Super Mario," Mario Draghi has little in common with the video game character of the same name.

Unlike the short, mustachioed plumber, Draghi is an ambitious man usually seen in a dark suit, white shirt and tie. Rather than yelling "mamma mia," he avoids making clear statements, choosing rather to speak in broad terms about global financial policies.

The 63-year-old's analytical thinking and seemingly Prussian discipline, as well as his fiscal conservatism, appeal to the sensibilities of a Germany worried it will foot the bill for the rest of the bloc's financial crises.

From his school days, the married father of two is said to have been a dedicated student. Draghi says his years in Jesuit school shaped his thinking.

"Excellent standards along with the moral message … determined one's whole day in school," he once said. "The message that one had to do everything as well as one could. That integrity is very important, and especially that each and every one of us was special in some way."

After private Jesuit school, Draghi studied economics in Rome, then earned his doctorate at the Massachusetts Institute of Technology (MIT). He taught economics at several Italian universities before going on to represent Italy at the World Bank between 1984 and 1990 before becoming leader of the Italian Treasury in 1991.

When crisis surrounded the Italian lira in 1992, Draghi chaired Italy's privatization committee to steer the country out of harm's way. He also rewrote Italy's financial regulation laws and oversaw austerity measures that allowed the country to enter the eurozone.

Last year, when he opposed a eurozone bailout for Greece, he referenced Italy's woes in the early 1990s, saying the country had come out of a much worse crisis with little outside help.

A financial hardliner

In 2005, Draghi quit a three-year stint with the investment bank Goldman Sachs. That brief period is considered the only tarnish on his résumé, as Goldman Sachs has come under fire for allegedly helping Greece hide its dire financial state in order to enter the eurozone.

Draghi has often said he had nothing to do with Goldman Sachs' Greece dealings. He sold all his shares in the investment bank before taking over as chief of Italy's central bank in 2006.

Italy's financial scene is reported to fear Draghi's projected hard line at the ECB. And, although critics have complained about nominating an ECB president from one of Europe's most indebted countries, Draghi himself has been known to criticize Italy's financial situation.

That fact should provide relief to many northern European finance ministers, who fear southern Europe could gain too much control of the ECB.

Author: Jan-Christoph Kitzler, David Levitz (AFP, dpa)

Editor: Martin Kuebler