France has decided to present Bank of France governor, Mr Jean-Claude Trichet as its candidate to run the future European Central Bank (ECB). The nomination was announced in a joint statement by President Jacques Chirac and Prime Minister, Mr Lionel Jospin. It sets Mr Trichet against Dutchman, Mr Wim Duisenberg, the current favourite and now head of the ECB's forerunner, the European Monetary Institute (EMI).

"The role of the future European Central Bank in ensuring the credibility and success of the single currency will be crucial and the choice of the team leading the European Central Bank will be decisive in ensuring that the euro is launched in the best conditions possible," the statement said.

"For this reason, French authorities have decided to present the candidacy of Jean-Claude Trichet, governor of the Bank of France, to the post of head of the European Central Bank executive board," it said.

Mr Chirac forwarded France's nomination to Luxembourg's Prime Minister, Mr Jean-Claude Juncker, whose country currently holds the European Union's rotating presidency.

The French announcement was immediately criticised by the Dutch central bank, which Mr Duisenberg headed before moving to the EMI this year.

"We are surprised by this nomination of Mr Trichet and we also think that it's not very wise," Dutch central bank spokesman Mr Olaf Sleijpen said. "We are of the opinion that Mr Duisenberg is supported by a very large majority of the member states of the European Union."

German central bank president, Dr Hans Tietmeyer has said he favours Mr Duisenberg as head of the ECB. The German Finance Ministry and the Bundesbank both declined to comment on yesterday's events.

France has been considering for some time whether to present its own candidate to head the ECB and had thought about naming International Monetary Fund chief Mr Michel Camdessus, a Frenchman, official sources have said.

Mr Camdessus, however, earned Germany's wrath while at the IMF, one source said. He fought hard to win approval of sales of IMF gold reserves to raise IMF funds for poor nations, running into fierce opposition from the Bundesbank.

France's decision to opt for Mr Trichet, with whom Mr Chirac has traditionally had cool relations, suggested the nomination had taken some account of Germany's views before it was announced. An official source said he did not think there was anything in France's announcement that would surprise German Chancellor Helmut Kohl.

European monetary officials said previously that Italy had joined France in seeking a rival candidate to Mr Duisenberg. Bank of France governor since 1993, Mr Trichet has been nicknamed the "Ayatollah of the franc fort" because of his willingness to raise interest rates to defend the stability of the franc against the deutschmark, even in the face of economic slowdown.

He has moulded the Bank of France, independent since 1995, very much in the likeness of the Bundesbank, often running into criticism from French politicians, including Mr Chirac himself, who would have preferred interest rates to come down faster.

"From the French point of view, Mr Trichet is well-qualified," Smith Barney economist, Mr Paul Horne said. "He is Bundesbankian, wellspoken . . .and he has resisted political pressure, including from the incumbent president (Chirac)."

"I think he was the most likely candidate for France to support," Merrill Lynch strategist, Ms Joanne Perez said. "He would certainly be an acceptable choice from the monetary perspective, from the German's point of view."

But she said France may have to settle for the deputy presidency of the ECB given Germany's recent strong support for Mr Duisenberg.