Tuesday

21st Aug 2018

Analysis

How will power swap in Italy and Spain change EU balance?

  • Europe will not be the main priority for Spain's new leader Pedro Sanchez (Photo: psoe/flickr)

In less than 24 hours, two of the largest five EU countries chose a new prime minister. But will the Italian-Spanish pas de deux change the political balance in the bloc?

In Italy, on Thursday evening (31 May), the anti-establishment Five-Start Movement (M5S) and the far-right League agreed with president Sergio Mattarella on the composition of a government led by Giuseppe Conte.

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  • Italian PM Giuseppe Conte is a newcomer with two party leaders as the real power in his government (Photo: quirinale.it)

In Spain, on Friday (1 June), centre-right prime minister Mariano Rajoy was ousted by a vote of no confidence in parliament and replaced by the leader of the Socialist Party (PSOE) Pedro Sanchez.

While the two countries were seemingly taking opposite paths, the first reactions appeared to be quite similar.

After a week of near-panic on financial markets, who dislike nothing more than uncertainties, the confirmation of a eurosceptic government in Rome has been welcomed with some relief, with a decrease of the yield of Italian bonds.


The pressure also eased on Spanish bonds as Sanchez, a moderate social-democrat, succeeded business-friendly Rajoy.

The European Commission, which had been rattled by the prospect of a founding member state (Italy) turning against the EU, expressed its "full confidence" that the Italian government would engage with the bloc and "uphold Italy's central role in the common European project."

It used almost the same language for Spain, saying that it had "full trust and confidence" in Sanchez's government.

The EU executive, as well as the 27 other EU countries, will have to wait at least until the next EU summit, at the end of June, to have a full picture of what the changes mean for the bloc.



Conte, the new Italian leader, is a newcomer to politics. The two real powers in his government, M5S's Luigi di Maio and the League's Matteo Salvini, have no government experience.

In Madrid, Sanchez will also be discovering government responsibilities and will try to govern without a stable majority.

Italian disruption?

But while Sanchez has promised to implement the budget prepared by Rajoy - thus following the fiscal path demanded by the EU - uncertainties remain over the Italian government's true intentions.

"I don't expect this government to be disruptive on any major issues," said Alberto Alemanno, Jean Monnet professor of EU Law at HEC Paris.

He noted that after Mattarella rejected a first government proposed by Conte last week, the new cabinet was "not an entirely political government."

"It is a techno-political government to reconcile call for change and EU treaties obligations," he said.


In addition to Conte, a law professor, the government will also include Giovanni Tria, an academic, as economy minister, and Enzo Moavero Milanesi, a former European Commission civil servant and EU affairs minister, as foreign minister.

Tria, who was chosen instead of Paolo Savona, an anti-euro academic, "will act as a guarantor of Italy's EU obligations," noted Alemanno.

But while the government may seem more euro-compatible, the political crisis of the last few days, in which the EU was accused of disregarding Italians' democratic will, has increased anti-euro sentiment and support for the League, political scientist Teresa Coratella pointed out.

Salvini winner

She argued that League leader Salvini was the "100-percent winner" of the crisis and would be the dominant force in the government, with a weakened di Maio.

"It will be quite difficult for Salvini to find allies, he is quite isolated," said Coratella, who works at the Rome office of the ECFR think tank.

"He could quickly clash on migration, which was a vital part of his campaign," she said. "But he knows he is in a key position to be the new leader of the Italian centre-right, and he could play his cards very carefully," she added.

"June will be key to see ho Italy can influence Europe," she said, referring to the weeks leading to the EU summit in Brussels that will be Conte's first interaction with EU leaders.

The other new kid on the EU bloc, Sanchez, is likely to play a more consensual role.


"Spain is not going to be as problematic. Sanchez will try to show he can be a leader," said Camino Mortera-Martinez from the Centre for European Reform think tank.

She pointed out that the new Spanish leader saw himself as a caretaker prime minister, whose priorities will be to repeal some of Rajoy's laws on freedom of expression and social rights, and to enable dialogue with Catalonia.

On Europe, she said, "we can expect a lot of continuity. Rajoy's Popular Party and Sanchez's PSOE have the same views on the way Spain should play a role in Europe."

No new Macron

Could Sanchez, a fresh-faced 46-year old succeeding a worn-out and lacklustre Rajoy, be a new Emmanuel Macron on the EU scene, by analogy with the youthful French leader?

"Europe is not his main priority," Mortera-Martinez said.

She said that contrary to the French president, the new Spanish leader has not won strong support through an election and that his leadership was also disputed by an old-guard within his party.

While the Italian eurosceptic coalition may try to block steps towards more EU integration, Sanchez will not be able to influence their debates.

"Neither Italy nor Spain will engage in Merkel-Macron discussions or take side," Alemanno pointed out.

"Macron will be even more alone. Only the commission supports him now," he said. "The June summit will clearly manifest that."

Italian crisis felt in Spain and wider EU

Collapse of government talks in Rome triggered instability on eurozone markets and controversy over an EU commissioner's comments on Italian democracy.

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