‘Instability hinders Italy recovery’

Political Instability hinders Italy recovery from recession: EU Commission™s pres.

The European Union Commission’s President Jose Manuel Barroso says political instability in debt-ridden Italy will affect Milan™s fragile recovery from recession.

œItaly needs systemic stability. It is one of the big countries of the eurozone, so, when there are indications of political instability, there are repercussions on the markets,” Barroso said in an interview with Italy™s daily II Messaggero published on Sunday.

œI hope that the political tensions will be resolved in order not to jeopardize trust in the Italian government,” Barroso added.

Separately, on Saturday, EU Economy Commissioner Olli Rehn said in an interview with Italy’s business daily II Sole 24 Ore that œI think it is of the highest importance to preserve political stability to ensure the recovery of the economy.”

On the same day, Italy™s Prime Minister Enrico Letta called for political stability in the country, warning against the economic consequences of the fall of his government.

œI want to send a very strong message here, we can no longer afford this instability based on political games,” Letta said.

œEverything depends on stability, without stability we have no chance of pulling through,” he added, highlighting that if his government falls, hopes of economic recovery and fiscal consolidation would be destroyed.

He made the remarks ahead of a vote by Italy™s Senate panel on September 18 on whether former premier Silvio Berlusconi should be expelled from parliament after a conviction for tax fraud.

Berlusconi’s allies have threatened to bring down the government if the vote goes against him.

Letta’s left-right coalition is in need of the support of Berlusconi’s People of Freedom party (PDL) to survive. The coalition has bickered since its formation in April, but the internal strife has increased since Berlusconi was sentenced last month.

Italy started to experience recession after its economy contracted by 0.2 percent in the third quarter of 2011 and by 0.7 percent in the fourth quarter of the same year.

Over the past decade, Italy has been the slowest growing economy in the eurozone as tough austerity measures, spending cuts, and pension changes have stirred serious concerns for many people already grappling with the European country™s ailing economy.

In June, Italy™s prime minister apologized to unemployed Italian young people who must leave the debt-stricken country to find jobs, saying œThe biggest debt that we are accumulating, by repeating the mistakes of the previous generations, is towards the young people, which is an unforgivable mistake.”


Copyright: Press TV