The tension between Italy and Brussels in the tug-of-war on public finances has dropped and the chances of receiving an infringement procedure seem, for the moment, to have receded. StItaly's debt “solutions can be found in the dialogue between the European Commission and Rome, but Italy must demonstrate that it will respect the rules in the future”. This was reported by Ansa which cites highly qualified European sources. “Rome – they continue – must realize the enormous impact that its economy has on the rest of the Union”.
From Osaka, where they are engaged in the work of the G20, the Prime Minister also shows calmness, Giuseppe Conte, and the Minister of Economy, Giovanni Tria. “The climate is constructive, I'm confident that a solution can be found”: said the prime minister who will meet the president of the EU Commission, Jean Claude Juncker, on the sidelines of the summit. The number one in via XX Settembre also took the same line: "We are adopting measures that bring us substantially in line, there are the foundations" to avoid the infringement procedure", Tria said, also explaining that "the trend of public finances is going better than expected".
The hands are ticking and the Italian leaders are trying to go for broke in view of 2 July, the day in which the European Commission will have to decide whether to recommend the application of a infringement procedure against Italy due to its excessive debt. The final decision should be taken by Ecofin, in the context of the summit to be held on 9 July. But after weeks of controversy, the first glimmers finally arrive.
But is it true thaw? All the countries of the Eurozone have so far been united in raising objections to Italy. The toning down seems more like an attempt not to give arguments to the sovereignists, of which Italy is the outpost in Europe, than a decision already taken and more accommodating towards our public finances.
Rome knows that the match will be played in Brussels and not in Osaka and the executive is reportedly working on a presentable proposal of between 7 and 8 billion. Reuters also reports that Rome would have guaranteed a 2019 net borrowing close to the threshold of 2-2,2% of GDP. On the other hand, it is more difficult to make commitments for the following year. "The source - writes Reuters - however explains that committing oneself already now to the 2020 deficit is equivalent to anticipating the maneuver and the government is not in a position to do so" also given the disagreements within it. More probable that the government limits itself to making promises on spending cuts and the revision of tax breaks without giving too many details. Will it be enough?
We remind you that the new Italian public finance framework is expected on Monday. On July 1, the Council of Ministers will meet to approve the budget adjustment bill.
