By Nicholas Rigillo, DPA
Brussels : There’s nothing easier than to dismiss Italy as a botched-up place plagued by revolving-door governments, mountains of rubbish and dangerous mobsters. But despite the enormous problems besetting Rome, Naples and Palermo, there is no hiding from the fact that the country matters.
Italy is a founding member of the European Union, contributing the third-largest sum to its budget. As a member of the Group of Eight, it has a powerful voice in global politics. And its geography gives it a strategic advantage in the Western Balkans and Mediterranean.
Above all, its economy is the fourth-largest in Europe and the third-largest in the eurozone.
“Size matters, especially when it comes to the economy,” said Marco Incerti of the Centre for European Policy Studies (CEPS), a Brussels-based EU think-tank.
“We are all in the same boat in Europe, so everyone wants things to go well in Italy,” Incerti told DPA.
Not surprisingly, officials in Brussels and in Europe’s capitals are following the Italian general election scheduled for April 13-14 with keen interest.
And according to EU officials, the economy will be the number one priority of the next government.
Joaquin Almunia, the EU’s economic and monetary affairs commissioner, places the emphasis on Italy’s massive public debt, which remains bigger than the country’s yearly gross domestic product (GDP).
“Consolidating the state of the public finances,” he recently said, “must be one of the objectives of all of the candidates taking part in the elections.”
Under Prime Minister Romano Prodi’s short-lived government, which ruled from May 2006 to April 2008, Italy’s budget-deficit-to-GDP ratio fell from 4.4 percent in 2006 to 2.4 percent in 2007.
But Italy’s promise to eliminate its budget deficit entirely by 2011 is now seriously threatened by the global economic slowdown.
According to Italy’s Institute for Studies and Economic Analyses, GDP is predicted to grow by a measly 0.5 percent in 2008. Meanwhile, inflation is on the rise and consumer confidence is low.
“I do not see where new growth is going to come from,” said Graham Watson, a British politician who has an Italian wife and leads the Alliance of Liberals and Democrats in the European Parliament.
Political experts have been following with great interest the new formation put together by Walter Veltroni, the centre-left’s main candidate for the post of prime minister.
Prodi’s government succumbed to the internal contradictions of its heterogeneous coalition, which spanned from communists to liberals.
To avoid a similar mistake, Veltroni has severed ties with the far left and is running solo at the helm of the newly formed Democratic Party, which unites social democrats and left-of-centre liberals.
According to Paul Ginsborg, a British professor of contemporary history at the University of Florence and a prolific commentator on Italian politics, Veltroni is trying to recreate in Italy what Tony Blair did in Britain with New Labour in the 1990s.
There is little doubt, however, that the main man being watched is Silvio Berlusconi.
The media baron turned politician is ahead in most opinion polls, and many in Brussels shudder at the prospect of witnessing his antics again.
EU diplomats have not forgotten a furious Berlusconi likening the German leader of the European Parliament’s socialist grouping, Martin Schulz, to a Nazi-era concentration camp guard.
And comments that Israel should be invited into the EU, that Russian President Vladimir Putin is a “true democrat,” and that the best way for a young woman to succeed in life is to marry one of his own sons, have also not helped endear Berlusconi to the Brussels elite.
But above all, Eurocrats fear that, if elected, his centre-right alliance’s protectionist views and sceptical attitudes towards Europe could throw spanners into the works of key EU plans to do with energy liberalization, climate change and the Common Agriculture Policy.
“At first, people in Brussels were incredulous. Now it is beginning to dawn on them that Berlusconi might return to power again,” said Incerti.