Italy Government Deal: What’s In It and What’s Next

The facade of the Palazzo Montecitorio, the seat of the Italian parliament in Rome, October 23, 2010
The facade of the Palazzo Montecitorio, the seat of the Italian parliament in Rome, October 23, 2010 (Stefano Maffei)

Italy’s populist Five Star Movement and (formerly Northern) League have finalized a coalition agreement.

Among their policies are:

  • Reducing personal and business taxes to two rates: 15 and 20 percent.
  • A €780 monthly basic income for poor families.
  • Repealing 2011 pension reforms that raised the retirement age and made the system financially sustainable.
  • Withdrawal of EU sanctions on Moscow.
  • Speeding up the deportation of around 500,000 immigrants.

The final version of the text does not call for a pathway for countries to leave the euro, nor does it call on the European Central Bank to cancel €250 billion in Italian debt. These proposals had been in leaked drafts.

However, the planned fiscal measures will almost certainly cause Italy to break the EU’s 3-percent deficit ceiling. Read more

Italian Pact Would Deprive Macron of Ally for EU Reform

Italian prime minister Paolo Gentiloni is received by French president Emmanuel Macron at the Elysée Palace in Paris, September 27, 2017
Italian prime minister Paolo Gentiloni is received by French president Emmanuel Macron at the Elysée Palace in Paris, September 27, 2017 (Elysée)

For the first time in its postwar history, Italy could soon be ruled by anti-EU parties. The populist Five Star Movement and (formerly Northern) League are on the verge of forming a coalition government.

Such a pact would deprive French president Emmanuel Macron of a key ally for EU reform. Read more

EU Reluctant to Add Six Balkan States

EU and Balkan leaders pose for a group photo in Sofia, Bulgaria, May 17
EU and Balkan leaders pose for a group photo in Sofia, Bulgaria, May 17 (European Council)

EU leaders met with their counterparts from the six non-EU Balkan states today to discuss their possible accession to the bloc.

Central and Eastern European members are eager to include Albania and the former Yugoslav republics. Other countries are less sure:

  • Voters in France, Germany and the Netherlands are wary of EU expansion.
  • Cyprus, Greece, Romania, Spain and Slovakia have yet to recognize Kosovo’s independence from Serbia.

Spanish prime minister Mariano Rajoy, who faces a separatist rebellion in Catalonia, even boycotted the summit. Read more

EU Defies Trump on Iran Deal and Trade

German chancellor Angela Merkel, French president Emmanuel and British prime minister Macron Theresa May talk on the sidelines of an EU summit in Sofia, Bulgaria, May 17
German chancellor Angela Merkel, French president Emmanuel and British prime minister Macron Theresa May talk on the sidelines of an EU summit in Sofia, Bulgaria, May 17 (Bundesregierung)

EU leaders have closed ranks against the unilateralism of American president Donald Trump, announcing on the eve of a summit in Bulgaria that:

  • They will stay in the Iran nuclear deal so long as Iran abides by its terms. That means European companies will — for now — be able to continue doing business with Iran.
  • They are willing to start trade negotiations provided the United States exempt the EU from aluminum and steel tariffs.

Both decisions set Europe on a collision course with its ally. Read more

Make-or-Break Moment for the Atlantic Alliance

Paolo Gentiloni, Mariano Rajoy, Emmanuel Macron, Angela Merkel and Mark Rutte, the leaders of Italy, Spain, France, Germany and the Netherlands, deliver a joint news conference in Berlin, June 29, 2017
Paolo Gentiloni, Mariano Rajoy, Emmanuel Macron, Angela Merkel and Mark Rutte, the leaders of Italy, Spain, France, Germany and the Netherlands, deliver a joint news conference in Berlin, June 29, 2017 (La Moncloa)

This week could be a make-or-break moment for the Atlantic alliance. Donald Trump’s unilateral withdrawal from the Iran nuclear deal has put European leaders on the spot.

  • On Tuesday, the foreign ministers of France, Germany and the United Kingdom — the thee European countries in the agreement — meet with Mohammad Javad Zarif, their Iranian counterpart.
  • On Wednesday, national leaders are due to discuss the issue over dinner on the eve of an EU summit in Sofia. Read more

Who Is Catalonia’s New President and What Happens Next?

Quim Torra enters the parliament of Catalonia to be sworn in as the region's president, May 14
Quim Torra enters the parliament of Catalonia to be sworn in as the region’s president, May 14 (Miguel González de la Fuente)

Quim Torra has been elected president of Catalonia with 66 to 65 votes in the regional legislature.

Torra was supported by his own party, Together for Catalonia, and its ally, the Republican Left. Both seek Catalan independence.

The smallest separatist party, the Popular Unity Candidacy, abstained to make it possible for Torra to take office, but it considered his predecessor, Carles Puigdemont, the only legitimate candidate.

Puigdemont, who led Together for Catalonia to victory in December’s election, was removed from power by Spain in the wake of the October 1 independence referendum that had been ruled illegal by the Constitutional Court. Read more

Time to Start Worrying: Populists May Form Government in Italy

Luigi Di Maio, the leader of Italy's Five Star Movement, answers questions from reporters in Rome, April 12
Luigi Di Maio, the leader of Italy’s Five Star Movement, answers questions from reporters in Rome, April 12 (Presidenza della Repubblica)

Italy’s Five Star Movement and (formerly Northern) League may form a government after all.

President Sergio Mattarella has given the two parties until Sunday to hash out a deal.

Time to start worrying. Read more