Saturday, December 9, 2023

Italy’s Di Maio rejects talks on debt cancellation in case of pandemic

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Italy must repay all additional public loans available to it
committed to fighting the Covid-19 crisis and does not need to resort to
canceling part of its public debt, the country’s foreign ministry
Luigi Di Maio said.

In an interview with the Financial Times, Di Maio downplayed the recent debate within the Italian government over the possibility that Rome could ask the European Central Bank to cut pandemic-linked borrowing. He argued that the large public sector debt in the euro area’s third largest economy was sustainable.

“The goal must be sustainable debt and good debt,” he said. “There has been a great debate about the debt incurred during the pandemic. Rather, I believe that we must now focus on spending this money in the most productive way possible for Italy. We need to make sure that these investments in the form of debt can be repaid and that they are productive investments. “

Italy’s public debt is expected to exceed 160% of gross domestic product this year due to sharp economic contraction
by the Covid-19 pandemic and the major recovery plans
launched by the government to combat it.

Last month, a political adviser to Prime Minister Giuseppe Conte
suggested that the ECB consider cancellation of the Italian government
he bought during the crisis to help the country recover.

Mr. Di Maio, who as Minister of Foreign Affairs is the oldest member of the
former popular five-star anti-euro movement in the mainstream
coalition government, said that while Italy’s debts should be honored,
of the EU public spending and borrowing rules, known as the
Stability and Growth Pact, was no longer suited to its objective.

“I believe that after this pandemic, we can no longer think about the
Stability and Growth Pact as we have done in recent years, I believe
that it would not be viable for any country. All countries, more or
less, had to go into debt, and therefore the old parameters of the
the stability pact is not working. We might even see the temporary again
framework for state aid in certain strategic sectors. “

Mr. Di Maio, 34, was previously Deputy Deputy Prime Minister
a coalition government between the Five Star Movement and Matteo
Salvini’s Anti-Migration League party which has repeatedly confronted
Brussels on Italy’s budget deficit.

In October 2018, he organized a victory celebration from a
balcony at the Prime Minister’s residence in Rome when
government accepted an increase in public spending,
confrontation with the European Commission. In 2019, he then prompted a
diplomatic quarrel with France by meeting yellow vests demonstrators.

Earlier this year, Mr. Di Maio resigned from the leadership of the Five Star Movement, which has yet to appoint a permanent replacement. He continues to be troubled by a public disagreement between moderates such as Mr. Di Maio and a more radical wing that is uncomfortable with the party’s support for its coalition partner, the Center Democratic Party. left.

Now Mr. Di Maio says that the Five Star Movement – whose deputies
The coalition government helped the coalition government to vote on Wednesday
reform the European Stability Mechanism that some of its politicians
had threatened to block – adjusted its once hostile approach to Europe.

The coalition government of Luigi Di Maio, on the left, and Matteo Salvini have clashed several times with Brussels over Italy’s budget deficit © AP

“I think Italy should not be left in the hands of [Hungarian premier Viktor] Friends of Orban, because what we have seen on the veto for the stimulus fund puts Italy and Europe in difficulty, ”he said.

“The nationalism which was in season for the last two or three years, and with which Italy still lives, is a form of national selfishness which has only proved to be continually harmful to Italy and to the European Union. .

“The Five Star Movement has realized its role [in Europe], and
tries to exercise it, making agreements with others
realities, ”added Mr. Di Maio.

“This does not mean that all is well in Europe. Indeed [on] immigration and asylum, both as Italy and as a political party, we expect much more. “

He congratulated the President of the European Commission Ursula von der Leyen for her
response to the Covid-19 crisis, and stated that the perception of
The EU in Italy had improved accordingly.

“In Europe, what we have always asked for are expansive policies, no
more austerity, and a different social policy, and I must say that for
the pandemic, the reaction was there, ”he said. “I am happy that Ursula
von der Leyen apologized to Italy, she showed great sensitivity in the
first phase of the pandemic.

“There was a time when the European institutions were dispersed,
[there was] a great crisis in the perception of the European Union.
Instead, there is now a good perception of the European Union because
of the stimulus fund. “


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