“During an interview with German Chancellor Angela Merkel (CDU), italian Prime Minister Giuseppe Conte made it clear that he does not want to be set by Germany in the current economic crisis.” I am the one who keeps the books,” Conte said on Saturday.
Merkel had urged in the Süddeutsche Zeitung that Italy should use all the aid instruments provided by the EU, including the European Stability Mechanism (ESM).
Merkel’s views have not changed, Conte said at a press conference. But he and his minister of economic affairs still kept the books. Italy are preparing a recovery plan to be presented in September, Conte added.
Merkel had told the SZ that the EU had not put in place instruments such as the ESM “so that they remain unused.” However, the decision rests with Italy.
In Italy, the debate over the possible use of the ESM divides the governing coalition. The Five Star Movement opposes this, while its coalition partner, the Democratic Party, is in favour.
Each country in the monetary union can rely on low-interest loans amounting to two percent of its economic output through the ESM. However, countries such as Italy fear that a request for assistance in financial markets could be interpreted as a signal of massive financial difficulties and could attract speculators. So far, no euro government has shown interest in ESM aid in the crisis.
The EU states are currently negotiating a multibillion-dollar Corona aid plan, which is primarily intended to support the countries particularly affected by the pandemic, Italy and Spain. However, the European Commission’s proposal for the massive reconstruction fund is highly controversial among the Member States, partly because the aid is to be used partly as grants and not as loans.