Italian parliament rejects European Stability Mechanism reform, upsetting Brussels

According to Reuters, on December 21, the Italian House of Representatives voted against the long-awaited reform of the European Stability Mechanism (ESM), casting doubt on the ratification of a European Union (EU) treaty drafted to help bankrupt banks.

Italian Prime Minister Giorgia Meloni. (Source: Reuters)

The vote confirmed deep opposition within Prime Minister Giorgia Meloni's ruling coalition to reforming the ESM, the eurozone bailout fund, which has been approved by all other eurozone countries except Italy.

Speaking to reporters, Ylenia Lucaselli, a lawmaker from Prime Minister Meloni's nationalist Brothers of Italy party, said the lower house of parliament would not discuss the ESM for the next six months.

A source in Prime Minister Meloni's office, who asked not to be named, said the objection could give the EU an opportunity to consider changes to the ESM to make it more relevant to the needs of the eurozone.

Prime Minister Meloni and Italian Economy Minister Giancarlo Giorgetti were not present for the debate and subsequent vote (72 votes in favor, 184 against, and 44 abstentions). The Brothers of Italy and Giorgetti's League both voted against, while the parliamentary group of the ruling coalition's Forza Italia party abstained. The opposition 5-Star Movement, led by former Prime Minister Giuseppe Conte, also opposed the move.

The government does not consider ESM reform important because Italy's banking system is among the most robust in Europe, a source in Prime Minister Meloni's office said. Prime Minister Meloni has repeatedly criticized the ESM for requiring countries to implement austerity programs or financial reforms in exchange for its help, arguing that this would increase the risk of debt restructuring.

Source: https://baoquocte.vn/quoc-hoi-italy-bac-bo-cai-cach-co-che-on-dinh-chau-au-khien-brussels-kho-chiu-254799.html