Free Trial

MNI: Lawmakers To Back Draghi If He Stays As PM-Party Sources

(MNI) ROME

Parliamentarians from across Italy’s political divide are likely to provide broad backing for Mario Draghi if he offers to stay in government and continue economic reforms in an address to parliament on Wednesday as pressure mounts on the prime minister to reverse last week’s moves towards resigning, senior officials from parties backing his government told MNI.

Sources from the centre-left Democratic Party and the centrist Italia Viva said they are convinced Draghi will remain as prime minister, while the right-wing League and Forza Italia, which had been tempted by the prospect of early elections, said they now see a 50% chance he will drop any idea of quitting.

The populist Five-Stars Movement, whose abstention in a Senate confidence vote last Thursday prompted a resignation offer, has already split on the matter, with its lower house leader Davide Crippa defying party boss Giuseppe Conte to say he would back the former European Central Bank chief if there were another confidence vote. President Sergio Mattarella, seeking to resolve the crisis, asked Draghi to address parliament this week.

More defections seem inevitable from Five Stars, which already saw more than a fifth of its members defect last month to join the new Together for the Future group led by Foreign Affairs Minister Luigi Di Maio.

EARLY ELECTIONS

While it is still unclear whether the League and Forza Italia would agree to continue to support a government coalition including pro-Draghi Five-Stars rebels, officials from all parties told MNI they would find it impossible to reject a new political programme from the prime minister on Wednesday if he asks for it and if it includes clear targets for meeting reforms to access the next EUR22 billion tranche in aid from Europe’s NextGenerationEU programme and for setting a 2023 budget.

While the League and Forza Italia had flirted with the idea of allowing Draghi to leave, which would bring forward elections they expect to win in partnership with the far-right Brothers of Italy, they are reluctant to take the political blame for bringing down a prime minister so widely respected at home and abroad, League sources said.

League leader Matteo Salvini and Silvio Berlusconi’s Forza Italia are sending mixed signals as to what they will do on Wednesday. While they say they will refuse to back another Draghi government if it includes Five-Stars, without whose support the prime minister has said he cannot govern, they have also been careful to set out what they would like to change in return for their continued presence in the coalition, including the removal of two ministers and a more restrictive approach to immigration.

The League has also suggested that it would be prepared for Draghi to stay on for a limited time to fast-track next year’s budget, before elections well ahead of the spring deadline. (See MNI: Italy To Start Work On Tighter 2023 Budget Early-Official)

PRESSURE ON DRAGHI

Draghi is still deciding on his speech for Wednesday, but a source who has spoken to him in recent days told MNI that he may be beginning to waver in his resolve to leave. The prime minister has been moved by calls from civil groups and more than 1,000 town mayors for him to stay on, sources close to him said.

Amid concerns that his departure would increase investor fears over Italy's financial health, he has also taken a series of calls from European leaders trying to convince him to change his mind, including Germany’s Olaf Scholz, France’s Emmanuel Macron, Spain’s Pedro Sanchez and Greece’s Kyriakos Mitsotakis, a government source told MNI.

Earlier on Tuesday Draghi saw Mattarella and Democrat leader Enricco Letta, after which one of Letta’s senior party officials said there now seems to be a 70% chance that Draghi will stay.

MNI Rome Bureau | +34-672-478-840 | santi.pinol.ext@marketnews.com
MNI Rome Bureau | +34-672-478-840 | santi.pinol.ext@marketnews.com

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.