The Italian Prime Minister has been in office since the beginning of 2021.
(Photo: Reuters)
Rome The cabinet meeting of Italy’s government lasted just under 40 minutes. Most important point on the agenda: the future of Mario Draghi. The prime minister announced to his fellow ministers that he would submit his resignation to the president that evening. The coalition of “national unity” that supported his government from the beginning no longer exists.
In the past few days he has worked “with great commitment” to continue on the common path. “Thank you for your work, the many results achieved,” said Draghi, according to a statement from his prime minister’s office. One must be proud of “what we have achieved in a very difficult moment in the interests of all Italians”.
The next level of escalation in the government crisis in Europe’s third-largest economy has thus been reached. And all because one of the largest ruling parties, the Five Star Movement, completely abstained in a key Senate vote on a multi-billion dollar stimulus package this Thursday.
Even if the sell-off of Italian government bonds accelerated again immediately after Draghi’s announcement, the interest rate for the ten-year bonds rose to 3.549 percent and the difference between the yield and the German bonds (spread) increased to 224 basis points after 208 points on Wednesday: Draghis A request for resignation does not necessarily mean that you are resigning. The decision about the political future of the country now lies with the President. And he promptly rejected Draghi’s request on Thursday evening.
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New elections not excluded
He will now most likely try to convince Draghi to continue. So it is conceivable that the prime minister will face another no-confidence vote in both chambers of parliament in the coming week. If Draghi passes the test with a large majority or even with the support of the Five Star Movement, the coalition could continue to govern as before.
A reshuffle of the cabinet is also conceivable, possibly without the participation of the five stars. Alternatively, although very few observers in political Rome have assumed this so far, Mattarella could appoint an interim prime minister by the time of the parliamentary elections. Even a name for a possible successor made the rounds on Thursday: Giuliano Amato, two-time prime minister and president of the Italian constitutional court for nine years.
If there is no new majority in the cabinet, Mattarella would even have to dissolve parliament and call new elections. These must be held within 70 days. The timing would be extremely unfavorable for Italy: In the fall, the government in Rome traditionally prepares the budget for the coming year, which then has to go through parliament – often with tough negotiations.
For the time being, however, Draghi will remain in office. The only question is how long: On Wednesday he apparently wants to address Parliament in a speech, as several Italian media reported.
It’s been a crisis for weeks
For weeks there has been a crisis between the Five Stars and the other government parties. After hours of discussion on Wednesday, the left decided to abstain from the Senate vote. The economic stimulus package with a volume of around 26 billion euros is primarily intended to help families and companies to get through the current energy crisis. But the cabinet plans did not go far enough for the party led by ex-Prime Minister Giuseppe Conte, and they kept demanding improvements.
Draghi, who has been in office since February 2021 and has since maneuvered Italy through the corona crisis and the start of the Ukraine war, has warned the governing parties several times in recent weeks to continue supporting the alliance. The regular legislature runs until spring 2023.
More: Italy before the election campaign – a country in political limbo