Tuesday

23rd Jan 2018

Italy denies need for bail-out

  • The 'Monti effect' is fading: investors are sceptical, while political and public support ebbs away (Photo: European Commission)

Italian Prime Minister Mario Monti has said his country does not need a bail-out, even though its borrowing costs have soared amid contagion from Spain, whose recent bail-out has failed to calm markets.

"Italy even in the future will not need aid from the European Financial Stability Fund," Monti said in an interview with the German Public Radio ARD on Tuesday (12 June).

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

He called on investors and market analysts "not to be governed by cliches or prejudices" and argued that his country has left its "undisciplined" past behind and is doing more to put its house in order than many other European countries.

He spoke as Italy's borrowing costs went above six percent on Tuesday, while Spain's reached almost seven percent.

The figures indicate that markets are unimpressed by the €100 billion bail-out secured last weekend for its ailing banks.

In a separate press conference that day, Monti refuted claims by Austrian finance minister Maria Fekter that Italy is the next in line for outside rescue.

"I find it completely inappropriate that representatives of other governments in the European Union are talking about the situations of other countries," he said.

Fekter - who is well known for her faux-pas - earlier that day said: "Italy has to work its way out of its economic dilemma of very high deficits and debt, but of course it may be that, given the high rates Italy pays to refinance on markets, they too will need support."

She backed down later on, saying she had no information about Rome planning to ask for aid.

Meanwhile, Monti's own political support is weakening.

Late on Tuesday, the technocrat Prime Minister summoned the heads of Italy's biggest political parties to remind them that their backing is crucial for Italy to "overcome the critical nature of the current situation and project an image of cohesion abroad," according to an official statement.

The former EU commissioner was appointed last year to take over the government and initially won EU praise for quickly implementing reforms.

But a deepening recession, high debt and low productivity are putting Italy on the same track as Spain.

Public confidence in Monti is also waning: a poll last week found that his support fell to 34 percent, compared to 71 percent when he took office.

Italy chastises Germany for handling of euro crisis

A German finance ministry official caused a stir Thursday by urging deficit countries to "become ants" rather than profligate "grasshoppers." Italy's Mario Monti urged Berlin to reflect "deeply" on its approach to the crisis.

EU states loosen grip on tax havens

Finance ministers removed eight entities from the tax havens blacklist, while ruling out more transparency or sanctions - prompting criticism from tax-campaigning NGOs such as Oxfam.

News in Brief

  1. Auditors criticise EU economic governance implementation
  2. Dutch environment group appeals air quality ruling
  3. Commission opens case into Polish railways state aid
  4. EU remove eight places from tax havens blacklist
  5. UK to keep forces in Germany over Russia fears
  6. Finnish presidential vote could go to second round
  7. Report: EU might pay Brexit residency fees for EU citizens
  8. Puigdemont free to travel around EU

Stakeholders' Highlights

  1. European Free AlllianceNo Justice From the Spanish Supreme Court Ruling
  2. Nordic Council of MinistersNordic Solutions for Sustainable Cities: New Grants Awarded for Branding Projects
  3. Mission of China to the EUTrade Between China, Belt and Road Countries up 15%
  4. Nordic Council of MinistersOresund Inspires Other EU Border Regions to Work Together to Generate Growth
  5. Mission of China to the EUTrade Between China, Belt and Road Countries up 15%
  6. AJC Transatlantic InstituteAJC Calls on EU to Sanction Iran’s Revolutionary Guards, Expel Ambassadors
  7. Dialogue PlatformRoundtable on "Political Islam, Civil Islam and The West" 31 January
  8. ILGA EuropeFreedom of Movement and Same-Sex Couples in Romania – Case Update!
  9. EU2017EEEstonia Completes First EU Presidency, Introduced New Topics to the Agenda
  10. Bio-Based IndustriesLeading the Transition Towards a Post-Petroleum Society
  11. ACCAWelcomes the Start of the New Bulgarian Presidency
  12. Mission of China to the EUPremier Li and President Tusk Stress Importance of Ties at ASEM Summit

Latest News

  1. Berlusconi in Brussels on pre-election charm offensive
  2. ECJ should rule against Austrian online censorship lawsuit
  3. EU states loosen grip on tax havens
  4. Facebook promises privacy reboot ahead of new EU rules
  5. Europe is lacking tech leadership
  6. Spitzenkandidat system here to stay, MEPs warn capitals
  7. MEPs to keep 28 UK seats after Brexit
  8. Norway defends new Arctic oil drilling