Juncker bows out as firefighter for cooled eurozone crisis

Luxembourg premier Jean-Claude Juncker chairs his last meeting of Eurogroup finance ministers on Monday after years battling the debt crisis, before handing over to a Dutch newcomer amid relative eurozone calm. The succession issue, with a lone candidate bidding to overcome French reticence, will dominate the talks starting from 1600 GMT, relegating discussion about an increasingly contested Cyprus bailout to second-tier status. Arriving at the European Union headquarters venue shortly before 1200 GMT, Juncker said he was leaving feeling "some melancholy, but mainly relief." Originally expected to lead the agenda at these talks, a formal request for aid from Nicosia appears to have gone backwards with the long shadow of Russian money-laundering especially hanging over negotiations. So much so that German Finance Minister Wolfgang Schaeuble, in an interview with German and French newspapers published on Monday, queried if any bailout should even take place -- unless absolutely necessary for the wider eurozone's collective interests. "We're still a long way from being able to decide on an aid package," Schaeuble told Sueddeutsche Zeitung. "First of all, we have to examine whether the problems in Cyprus represent a danger for the eurozone as a whole. That is one of the pre-conditions for the money coming from the euro rescue fund." This flagged one issue for the ministers, as Dutch Finance Minister Jeroen Dijsselbloem -- who took up his national job only in November -- bids to secure the high-profile role as Juncker's replacement. The mood has changed in 2013, mainly due to European Central Bank action to guarantee downwards-pressure on bond yields for governments which find interest rates on the debt market becoming prohibitive, as was the case for Spain and Italy last year. "Markets are no longer betting that the ECB will commit suicide by letting major member countries implode," said Holger Schmieding, chief economist with Germany's Berenberg Bank. Even Greece, despite a sixth year of recession, is said by its public creditors to be on the mend. International Monetary Fund managing director Christine Lagarde told Athens daily Kathimerini on Sunday that no additional measures would be necessary if Greece carried out its obligations under the re-written aid programme finally agreed in December. -- Vision for Eurogroup -- -------------------------- "But if the structural reforms are not carried out...then more cuts would be necessary," she underlined. Dijsselbloem formally announced his candidacy on Thursday in the Dutch parliament, and after a flying visit that evening to Madrid to secure Spain's backing, faces one last hurdle on Monday night, which is to convince Paris with his manifesto for the job. "We'll see Monday how it goes. My French colleague has asked for a presentation of...(my) vision for the Eurogroup," Dijsselbloem said after a symbolic meeting on Juncker's home ground on Friday. Juncker said on Monday of this hurdle: "I don't think there are unsurmountable problems." Dijsselbloem is more left-leaning politically, although the change still symbolises to most an acceleration in the pressure on southern eurozone economies to change political course. But even Germany's conservative Chancellor Angela Merkel found left-leaning rivals stealing a surprise march on Sunday in a regional election which ran counter to a recent strong showing in the opinion polls for Merkel, the top powerbroker in the eurozone debt crisis. Ministers from the 17 eurozone states are also due to tackle the thorny question of "legacy assets" at the evening talks -- in other words, which old banking debt can be considered eligible in the event of future recapitalisation of lenders by the eurozone rescue fund, the European Stability Mechanism. Tuesday's meeting of all 27 EU finance ministers, meanwhile, will focus on a bid by 11 eurozone states to launch a tax on financial transactions.