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Italy minister says people will decide about leaving EU

Staff Writer | October 9, 2018
Italy's EU Affairs Minister Paolo Savona expects the European Central Bank to shield his country from any financial crisis that could derive from Rome's controversial budget plans.
Paolo Savona
Europe   Minister Savona expects the European Central Bank to shield his country
"I think that in the end [ECB President Mario] Draghi would take care of it, not taking care of Italy, but taking care to avoid a serious crisis in Europe," Savona said at a Monday press conference.

Italy is planning to increase its deficit, flouting EU budget discipline rules, in the hope of stimulating growth. This has spooked Brussels officials and financial markets.

The spread, a key sovereign risk indicator which measures the yield differential between Italian and benchmark German 10-year bonds, jumped above 300 basis points on Monday, a five-and-a-half-year high.

But a clash with the EU over budget targets risks causing "a financial crisis which I believe is in nobody's interest," Savona said, speaking at the Foreign Press Association in Rome.

There would be "political instability" and "something very serious would happen", the minister said, predicting that "in the end we will find a compromise. If not, so be it, and decisions will be made".

Savona, a eurosceptic economist who in the past talked of a "plan B" for a eurozone exit, dodged a question on whether this, or debt restructuring, could be a worst case scenario for Italy.

"I cannot tell you what will happen if Europe takes on a confrontational stance against these [budget] plans, which are valid, cautious and even moderate. The people will decide, not me," he said.


 

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