Italy’s economy minister signals he is ready to back ESM reform
Italian Economy Minister Roberto Gualtieri signaled that he was ready to back a delayed reform of the euro zone ESM bailout fund, telling parliament that its approval would not mean Italy wished to use it.
Euro zone countries agreed almost a year ago “in principle” on widening the responsibilities of the European Stability Mechanism (ESM) and ministers from the 19 countries sharing the euro currency are expected to give the deal a final go-ahead later on Monday.
However, some parties in Italy, including the 5-Star Movement, which is in the ruling coalition, have repeatedly attacked the reform, arguing, among other things, that it would increase the risk of public debt restructuring.
Gualtieri, from the co-ruling Democratic Party, has consistently backed the changes and he looked to reassure critics on Monday when he addressed a parliamentary committee.
“Today’s decisions only concern the reform of the ESM, the early introduction of the common backstop and the positive assessment of the reduction of risks in the banking system. All these decisions do not in any way affect the use of the ESM,” he said.
He added that proposed changes to the so-called collective action clause in the ESM reform would not increase the probability of public debt restructuring — something the opposition League has repeatedly asserted, along with 5-Star.
Source: Reuters (Reporting by Giuseppe Fonte; Writing by Crispian Balmer; Editing Gavin Jones)