UPDATED: Jens Stoltenberg has resigned from his new job as Norway’s central bank chief even before he began. He confirmed Thursday that he’ll stay on for another year as secretary general of NATO, which is in the midst of what he called “the biggest security crisis in a generation.”
“If I can make a difference in this it will be the most important thing I can do with my life,” Stoltenberg told Norwegian reporters late in what became an extremely eventful day for both NATO and Norges Bank. “I see it as a privilege to stay on in the job as secretary general of NATO.”
He said he also was motivated to become governor of Norway’s central bank, but after Russian President Vladimir Putin invaded Ukraine, which Stoltenberg described as “a peaceful neighoring country,” he said the situation gave him “no choice but to continue in NATO. I think the right thing to do is to be fully present in NATO.”
Stoltenberg’s decision means that the top job at Norway’ central bank (Norges Bank) will now go permanently to Ida Wolden Bache, a former deputy governor of the central bank who already has held the governor’s post since March 1 on a temporary basis. She took over when former Norges Bank Governor Øystein Olsen retired at the end of February.
Bache (roughly pronounced “BAH-keh”) is a highly respected economist who’d been considered by many as the best candidate to become Norges Bank’s governor. She was the frontrunner in the hiring process last year until Stoltenberg, a former Norwegian prime minister whose latest term at NATO was due to expire this fall, expressed interest in the job. Despite considerable debate over his candidacy, Stoltenberg ended up controversially winning the post and was due to move back to Oslo when his current term as NATO chief was to expire on September 30.
Now, urged to stay on at NATO even before Russian President Vladimir Putin invaded Ukraine, and again as Putin’s war on Ukraine escalated, Stoltenberg stated on Thursday that he was “honoured by the decision of NATO Heads of State and Government to extend my term as Secretary General” until September 30, 2023.
“As we face the biggest security crisis in a generation, we stand united to keep our alliance strong and our people safe,” Stoltenberg wrote on social media Thursday afternoon.
Norway’s finance ministry in Oslo was ready with a press release, meanwhile, confirming that Stoltenberg had given up his position as central bank chief. The ministry, which holds political responsibility for the central bank, stated that it also would now put forth a proposal to King Harald V that Ida Wolden Bache be appointed as new central bank chief.
“I would of course gladly seen that Jens Stoltenberg became our next central bank chief,” stated Finance Minister Trygve Slagsvold Vedum of the Center Party, “but we’re right in the middle of a dramatic situation in Europe and I have great understanding that he has prioritized the important role he has in NATO.”
Vedum confirmed that Bache would now formally be proposed as Norway’s new central bank chief for the next six years. He noted that she was evaluated as being “extremely competent” just recently, during what turned out to be a hotly debated hiring process last fall and winter. Stoltenberg, also a former leader of the Labour Party, even wound up with a majority against him in Parliament because of his political ties to the current Labour-Center minority coalition government.
It’s thus been a rather embarrassing hiring process for the ministry and Vedum, which also set off a parliamentary investigation after questions were raised about political favoritism and the ultimate political independence of the central bank. The probe into the disputed process has since been suspended.
Now the ministry and Vedum have ultimately lost their top candidate but gained the non-political candidate supported by a majority of others. Vedum acknowledged in Thursday’s press release that Bache “has already functioned as central bank chief for a few weeks and fills the role in a good manner. Norway has an excellent central bank chief in her.”
Bache confirmed on Thursday that she has accepted the position: “I applied for the position because I have a strong engagement for Norges Bank, our competent colleagues and our role in society. That engagement is just as strong today,” she wrote in a press release from Norges Bank. Her appointment was well-received in Parliament, with the Conservatives’ Ine Eriksen Søreide telling state broadcaster NRK that “she will be a very good central bank chief,” and the Socialist Left Party’s Audun Lysbakken said she “is a good choice as central bank chief and we wish her good luck in the position.”
Bache, born in 1973, holds both a master’s degree from the London School of Economics and a doctorate in economics from the University of Oslo. She has worked in various roles at Norges Bank since 1998, specializing in monetary policy and interrupted only by a three-year stint as senior economist at Handelsbanken Capital Markets from 2010 to 2013.
She had earlier consistently refused to comment on all the controversy, opting instead to graciously accept the temporary role as governor before returning to her earlier post as vice-governor when Stoltenberg was to take over. Now the vice-governor’s position needs to be filled instead.