Belgian Finance Minister resigns over banking dispute

PanARMENIAN.Net - Belgian Finance Minister Steven Vanackere resigned on Tuesday, March 5, leaving the six-party government scrambling to find a successor to steer imminent talks on further austerity savings, Reuters reported.

Belgium only emerged at the end of 2011 from 18 months of political paralysis which saw its bond yields shoot to euro-era highs as investors worried about its ability to rein in deficits and tackle a debt burden approaching 100 percent of output.

Vanackere's departure follows a dispute over a favorable interest rate paid to a labor union linked to his Flemish Christian Democrats party by state-owned bank Belfius, the former retail banking arm of bailed-out Franco-Belgian group Dexia. Lawmakers have questioned in parliament whether the finance minister knew about the terms of the loan.

"Through my political inspiration, which is rooted ... in the Christian Democratic workers movement, some can't imagine me doing my duty as a finance minister in an impartial way, even though the allegations cannot be firmed up at all," Vanackere told a news conference on Tuesday.

The Flemish Christian Democrats, who will retain the post, said they would appoint a successor as soon as possible, but would not say when that might be.

Belgium's government is to start negotiations this month on adjusting its austerity program.

Belgium cut its budget deficit to about 3 percent of gross domestic product in 2012 from 3.7 percent in 2011, with 14.5 billion euros of savings, including plans to raise the effective retirement age. It aims to trim the deficit further, to 2.15 percent of GDP, with a 3.4 billion euro savings package agreed.

Vanackere became finance minister in December 2011, having served as foreign minister for two years.