Italian populists look to resurrect coalition


Jun 1, 2018-

Italy’s populist parties launched a last-ditch bid on Thursday to resurrect a coalition government that collapsed as the president vetoed their controversial pick for economy minister.

Luigi Di Maio, head of the anti-establishment Five Star Movement, said on Wednesday he was prepared to offer a compromise candidate in the place of economist Paolo Savona, who has called for Italy to drop the euro. It would be an olive branch to President Sergio Mattarella, who at the weekend ruled out approving the coalition’s cabinet lineup if it included Savona—prompting Di Maio to demand the president’s impeachment.

Nearly three months of political turmoil following an inconclusive election in the eurozone’s third biggest economy have rattled financial markets, although they rebounded slightly on Wednesday and Thursday.

The Milan Stock Exchange was up 0.79 percent by 1100 GMT after closing up 2.09 percent Wednesday while the bond market continued to strengthen. Investors have deep doubts over Italy’s financial stability, with the country struggling under a debt mountain of 2.3 trillion euros.

Popular support has soared for the nationalist League party, Five Star’s more powerful coalition partner, leading many to fear that fresh elections could essentially become a referendum on euro membership. Mattarella has asked pro-austerity economist Carlo Cottarelli to form a caretaker government, but now says he is assessing Di Maio’s offer of a compromise with “great interest”. The League has been beating the drum for new elections, but its leader Matteo Salvini said Wednesday he had “never closed the door” on hammering out a government. Salvini, 45, and the 31-year-old Di Maio were to meet later Thursday in Rome.

Cottarelli meanwhile has a caretaker team ready to step in should the Five Star-League negotiations fail — but the lineup is doomed to lose a confidence vote in the populist-dominated parliament, meaning that elections would likely be held after August.

The timing of polls is already the subject of heated debate, with the centre-left Democratic Party saying they should be held in July while the League says they should take place after the summer holidays.

Published: 01-06-2018 08:55

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