CLAUDIO COSTAMAGNA* at FIRSTONLINE.INFO
“Here we need a write-off. It is time for Europe, and with it Italy, to get out of its procrastination and take the debt emergency and the short circuit between sovereign risk and banking risk head-on. What is needed is a flash solution of great impact such as the Brady bonds of the 80s which made it possible to reabsorb the debt of South American countries. I know perfectly well that it is difficult, but it is in these moments of crisis that a ruling class, if it exists, demonstrates its leadership capacity". Claudio Costamagna, 54, former golden boy of Goldman Sachs and now independent banker and president of the business boutique he founded CC&Soci, but also director and president of the advisory board of Virgin Group and independent director of Bulgari , of Luxottica, della Dea and del Sole-24 Ore, is currently closed in a business meeting in Geneva. But he doesn't take his eyes off the computer as they photograph the Stock Exchanges on a roller coaster, the Euro crisis, the fearful widening of the spread between the Btp and the Bund. Like all men of finance, Costamagna has experienced many other major crises, but the attack on the euro and the days of passion that Italy is experiencing do not leave him indifferent. He claims: “It's no longer time for hot cloths. Among all the managers, entrepreneurs and bankers that I am meeting in these hours and who come to ask for advice there is an absolutely shared orientation: it is time for Italy and Europe to give strong and immediate signals. The crisis does not wait and runs the risk of spiraling back on itself. It's useless to blame speculation, we need to go to the root of the disease, which is – especially for Italy – high debt and low growth in a country that has excellent entrepreneurs but has a quarrelsome political class unable to find the compass”.
FIRSTONLINE – Wise considerations, Dr. Costamagna, but what can we really do in the short term?
COSTAMAGNA - As I have already said, Europe should take the bull by the horns and launch a plan similar to the American plan that the US Secretary of the Treasury Brady launched at the time to deal with the debt of South American countries: issue Eurobonds or government bonds fully guaranteed to be sold to the banks in exchange for the discount bonds of the most indebted countries.
FIRSTONLINE – It's Italy?
COSTAMAGNA – Italy must make a leap in quality if it has the strength. It is not a question of improvising recipes but of applying what the Bank of Italy and the most lucid minds in the country are repeating even in these dramatic hours.
FIRSTONLINE – Is that to say?
COSTAMAGNA – First of all: anticipate and strengthen the definitive approval of the economic maneuver by clarifying and resolving all the doubts that remain on the 2011-12 public accounts in front of the markets and making some measures postponed to future years immediate. But that's not enough, because Italy's problem is not only that of financial stability but also that, increasingly serious, of very low growth.
FIRSTONLINE – However, it is difficult to imagine some miraculous intervention that will boost growth immediately, without aggravating public finances: don't you think?
COSTAMAGNA – No miracle and no sleight of hand. There is only one thing to do together with the approval and strengthening of the manoeuvre: immediately open and implement the Draghi agenda that the Governor and future president of the ECB illustrated in his Final Considerations of 31 May at the Bank's meeting of Italy. Which means: liberalizations and reforms immediately.
FIRSTONLINE – Costamagna, you carried out the most important Italian privatizations with Mario Draghi at the Treasury and then worked with him at Goldman Sachs. Tell the truth: in an emergency situation like the Italian Draghi, if he weren't destined for the ECB, would he have been the ideal man to become the new Ciampi at the helm of a guarantee government?
COSTAMAGNA - Certainly. Mario has all the qualities of a true leader: great technical competence, strong ethical rigor and great realism and sense of balance. He would have been an excellent premier. But it is useless to pursue illusions and Draghi will do a great service to Italy and Europe as president of the ECB: it is fortunate that he is at the head of the large financial institutions at a time like this and the markets know this.
*Claudio Costamagna has been a director of the Company since 2006. A graduate in Business Administration, he held important positions in Montedison, Citigroup and Goldman Sachs, where he was for many years President of the Investment Banking division for Europe, the Middle East and Africa. He is currently Chairman of “CC e Soci”, a financial advisory boutique he founded. He is a member of the International Advisory Board of Bocconi University. He is a director of Luxottica, Bulgari SpA, DEA Capital SpA, Virgin Group Holding Limited and Il Sole24Ore.
