Luigi Di Maio is certainly right about one thing: the nascent government, branded Lega-M5s, could bring about a real political turning point for Italy. Not only domestic, but also foreign. While the political leaders of the two parties are busy choosing the Premier and dividing the most important seats, the government contract between the two political factions it is already causing a stir and fear across Europe.
There are many hot spots and just as many promises of the program which, when subjected to critical analysis, appear not only difficult to maintain but very expensive, with the risk of derailing Italy and its public finances: from the revision of the debt with the ECB to the abolition of sanctions against Russia, obviously passing through the two cornerstones that distinguish the and which allowed Lega and Cinque Stelle to win the elections, namely the flat tax on the one hand and the basic income on the other.
In this context, it seems important to understand not only how Italians are experiencing this tormented political phase, but also how it is perceived outside our borders. In this interview with FIRSTonline, Regina Krieger, correspondent in Italy of handelsblatt, leading German economic newspaper, tells us about the opinions on the new government widespread in Germany and explains what concerns Europe has regarding the political course that is about to emerge in our country.
Italy is experiencing days of great political tension with the (probable) birth of the Lega-M5S government which announces its intention to radically change the political guidelines of the recent past: what is your opinion and what strikes you most about this phase of our Village?
“We foreign correspondents are working tirelessly these days to try to get abroad to understand what is happening. The new Italian reality is very difficult to explain because it is necessary to convey what represents a real turning point in the country's domestic and foreign policy. It is not easy to even describe why the formation of a new government is dragging on for so long.
Two things strike me in particular about this phase: the political impact it is having and could have in the near future and the concerns about the economic choices that the nascent Executive raises throughout Europe”.
The leaders of the M5S and the League often refer to the German model when speaking of the government contract. Is the path followed by Italy in preparing the new Executive really similar to the one adopted in Germany for the birth of the Grand coalition?
“It is a wrong comparison. First because coalition governments have been a tradition in Germany for many, many years. Today we are in the fourth Grosse Coalition formed by the Social Democrats and the Cdu / Csu of the chancellor, Angela Merkel. Even at the regional level there are many coalitions. This feature is determined by our electoral system, which has always been a mix of majority and proportional representation.
Above all, the type of work that underpins the new German government and the contract that led to its birth is different. Even our political representatives this time took a long time to come to an agreement, it took them six months, it's almost a record, but in the end they produced a text of 178 pages. I have read it in its entirety: it is very clear, detailed, precise on every point and on every measure. The pages written by Lega and M5s seem anything but. Also for this reason, in my opinion, the Italy-Germany comparison is improper".
Remaining on the contract, the Lega-M5S program does not lack critical references to Europe with the request for revision of the Treaties and the proposal to the ECB not to calculate government bonds for all countries (but in fact it applies to the most indebted ones) detained at the end of Quantitative Easing: what do you think and what reactions do these news arouse in Germany? Do you think that the temptation to place a ceiling on the quantity of government bonds held by Italian banks could re-emerge?
“The damage has been done in recent days, especially to Italy's image abroad, there is no doubt. The reaction to these proposals in Germany, especially from economists, was strong. The draft of the contract that emerged at the beginning of the week, although it was subsequently toned down and attenuated in the requests to be presented to the European Union, was received in Berlin as a real 'bomb'.
In my opinion, the discussion on the possibility of putting a ceiling on the amount of bonds held by banks will arrive shortly, also because the common view from abroad is that Italy is taking steps backwards compared to the progress made in recent years. Until a few weeks ago, the country was observed with a very benevolent eye by Germany, the progress made was praised. The growth achieved, even if contained, was judged positively. Simply put, the Image that Italy had managed to acquire was very good. Now we risk going back to the old stereotypes and this is something I personally regret a lot.
The proposals that Lega and Movimento 5 Stelle promise to bring to Brussels are absolutely not in line with Europe and its rules and therefore not only damage Italian-German relations, but they hurt (in primis) to a European Union which, in such a delicate moment, characterized by the trade war with the United States, should instead speak with one voice”.
Has concern about what is happening in Italy returned to Germany?
Yes, what is happening is of concern, it is inevitable. Italy is a sovereign country and as such makes its decisions, but in Germany there are fears about the future, also because what happens in Rome affects everyone. Obviously we are no longer in November 2011, when Italy was on the verge of default, but in the last few days the first reactions of the markets have already been seen, just look at the rise in the spread.
At this point we have to wait to see what the behavior of investors will be. Obviously we have to accept the vote that came out of the polls, but this about-face comes at the least opportune moment because Italy was doing well: exports were improving, investors returned to Italy, there was a climate of confidence in the country and these policies could nullify everything.
More generally, what is your opinion on the political-economic proposals, also on domestic and not just foreign policy, of the nascent Italian government?
“We have already talked about the proposal to the European Central Bank on government bonds: it is unfeasible and does not comply with EU regulations. Speaking instead of internal politics, the real problem is that there are two political forces that made promises to their electors and now have to try to keep them. In my opinion, however, basic income, flat tax, etc. they are proposals that cannot be financed, a realistic look towards the country is missing.
My doubts involve not only the program but also the protagonists of this phase who unfortunately seem to me real amateurs of politics. Observing their formation, listening to their words and their populist drift, strong questions cannot but arise. Concern then grows when one considers that the Stability law will need to be passed in the autumn. How will they avoid the VAT increase, ignore Brussels' demands? There are many questions and above all the problems that Italy will have to face”.
A crucial point is also the new international position of Italy which, while reiterating its loyalty to traditional alliances and to NATO, is calling for the abolition of anti-Putin sanctions and indicating Russia as a new "strategic partner" in hot countries such as Syria : What will Germany say about these new Italian foreign policy orientations?
“The part of the program on respect for alliances and loyalty to NATO is important and somewhat reassuring. As far as the abolition of sanctions against Russia is concerned, however, it is not new that Italy wants to revoke them, this has already been discussed in the past, above all in relation to the need to ensure energy resources for the country. Even in Germany there are political forces that would welcome a rapprochement with Russia, but there are European pacts that everyone must respect, including Italy”.
What reflections do the birth of the first "populist" government in Europe and the anti-EU orientations of the countries of the Visegrad pact in Eastern Europe arouse in Berlin? Will Germany respond by confirming its foreign and European policy or will it begin to think that there is something to review compared to the recent past in order not to fuel new populist and centrifugal impulses?
“The problem is that Europe is currently quite weak. It is there for all to see that Macron has not yet managed to give that 'new course' that has been talked about so much and even Chancellor Merkel does not seem too convinced of these proposals, despite initially being greeted with enthusiasm. At the moment Europe seems quite fragile and if we add to this that Italy, which is the third largest economy in the Eurozone, fundamental for the future of the EU, today seems willing to do an about-face on many rules, it becomes even more difficult to keep Visegrad countries under control. It represents a further aspect of weakening, provided that obviously the new Executive really wants to keep its promises”.
With regard to the 'new course', the centrality of Germany in Europe and in the world seems to be clouding: the axis of reforms imagined by Merkel and Macron does not seem to be making progress, the centrifugal forces are multiplying in the Old Continent and the relations between Europe , and above all Germany, and Trump's United States are at an all-time low: how are the Germans experiencing this turbulent international season?”
“Even at this juncture there are many fears because one feels in the air that the golden times are waning, that the economic climate in Germany, but in general throughout Europe, could worsen again. It must be admitted that the German locomotive has begun to slow down and, moreover, Berlin is very exposed to exports, like Italy.
Speaking of relations between the Old Continent and the United States, Europe appears increasingly divided. Also for this reason there is a need for a strong Italy in the international context. For example, in recent weeks on Iran and Syria, the Italian voice has been totally absent and this is not good for anyone. It is the Italy-France-Germany trio that must guide the Union in such a sensitive moment because without Italy Europe is weaker”.
Can Italy fall behind other countries with the new political turn?
"I don't see these politicians as statesmen on the international stage, so yes, it can fall behind and it's a shame because Italy has always been there and with the signs of economic improvement given in recent years it was gaining an important role in the Old Continent . Germany and Italy have always had a very active exchange, not only political, just think of the manufacturing industry. Unfortunately, all of this risks disappearing”.
