The political turmoil in Italy seems likely to continue, despite the decision of the nation’s president to appoint a technocrat PM.
Italy held a general election in March which produced no overall winner, but left the “traditional” parties as minorities. Since then, the nationalist La Liga (formerly, The Northern League) and the anti-establishment Five Star Party (5SP) trying to bridge their considerable differences and form a coalition administration. That task seemed to have borne fruit just last week when a political novice, Giuseppe Conte, was selected by the two parties as PM. Conte went to the Italian President, Sergio Mattarella, with his proposals for a new government, but his nomination of Paolo Savonna as finance minister was deemed unacceptable by the President. Savonna is a Eurosceptic and the President cited concerns from domestic and foreign investors as the justification of his extraordinary move, fearing that the appointment could destabilise the country. It resulted in a call from 5SP to ask parliament to impeach the President.
The upshot of this was that Conte has withdrawn as putative PM and the President has appointed a former IMF economist, Carlo Cotarelli, as PM. If the Cotarelli administration survives long enough, he intends to call a fresh election early next year. It is far from certain that his administration will get enough parliamentary backing to govern and fresh election may be held as early as the autumn.
La Liga and 5SP have called for peaceful demonstrations against Mattarella; La Liga’s Di Maio said: “I call citizens to mobilise, make yourselves heard, it’s important that you do it right now. We will organise peaceful and symbolic demonstrations”.
An autumn election would seem to be a forgone conclusion and it is likely to be fought on Italy’s place within the Eurozone which constrains Italy’s economic freedom since it must abide by rules governing all 19 Eurozone members. Some Italians blame the Eurozone for the nation’s stagnant economic performance and high levels of unemployment.
Mattarella’s actions were applauded by the French President and the German Chancellor. Emmanuel Macron said that the Italian president had shown a “great spirit of responsibility” in acting for Italy’s “institutional and democratic stability”. Mrs Merkel whilst pointing out that Italy’s economic policy must be in keeping with Eurozone rules said that she would work with any Italian coalition government, commenting: “Look, when there were elections in Greece and Alexis Tsipras was made premier, there were many questions on the table. We spoke with each other over many, many nights, but together we achieved something. But we have to do that task, since Italy is an important member of the EU”, when asked if she was concerned about the situation.
The Italian economy is the third largest in the Eurozone behind Germany and France and the fourth largest in the EU behind the UK.