Jörg Asmussen
Jörg Asmussen says Germany must form government soon (Reuters)

European Central Bank heavyweight Jörg Asmussen has called on Germany's political leaders to form a government so that they can focus on reforming the European Union.

In an interview with Reuters, Asmussen, who is a member of the ECB's executive board, said that the eurozone crisis would be a hot topic of discussion at the autumn meeting of the International Monetary Fund in Washington D.C.

"Swift formation of a government would certainly be helpful from a European point of view as there are important decisions to be taken for Europe, for example a banking union," he said.

The critical task for European policymakers over the next few months was to find a way of winding down risky banks by December according to Asmussen.

The ECB is keen to have a defined resolution mechanism by the time it starts supervising eurozone banks in 2014.

Progress In Europe

The most troubled eurozone members including Spain, Greece and Ireland had made progress in reforming their finances said Asmussen.

Spain was recently praised by the International Monetary Fund for its banking reforms.

Meanwhile Ireland had a £1bn (€1.1bn, $1.6bn) tranche of aid approved as part of its bailout programme by the IMF.

Even Greece appears it might be able to achieve a budget surplus later this year and re-enter the bond markets in 2014 after six consecutive years of recession.

However, Asmussen added that the ECB's emergency Outright Monetary Transaction (OMT) bond purchase programme was ready to be activated if needed.

The Indispensable Lady

Asmussen's focus on Germany underlined the importance of Europe's largest economy to the future of the European Union.

German Chancellor Angela Merkel is in an especially influential position to shape Europe's future direction.

After winning a decisive third-term in the German elections in September, she will play a critical role in forming a new German government.

Any further European integration will also have the heavy involvement of Chancellor Merkel.

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