Draghi in the spotlight as Italy’s presidential election approaches
[ad_1]
Mario Draghi, the Italian Prime Minister, attends the press conference at year’s end.
Mondadori Portfolio | Mondadori Portfolio | Getty Images
Investors are once again interested in Italy because of the threat to political stability that could result from the next presidential election.
As Sergio Mattarella ends his term on February 3, the country’s parliament and regional delegates will determine who the next president. More than 1,000 representatives from the region and parliament of the country are scheduled to vote on January 24.
What is the point?
It is important to decide whether Mario DraghiThe country’s current prime minister will become the next president.
Draghi was appointed to the national political scene by the European Central Bank former president. This brought an end to years of political turmoil in Italy. Shortly after Draghi was appointed, the yield of the 10-year Italian bond fell to 2021’s lowest point. news that Draghi was likely to be the new prime minister.
His governmentThe majority of its members are politicians representing different political parties, as well as some technocrats. It has been able to appease the markets through its support for reform and parliamentary backing.
Draghi’s departure from government may jeopardize this political and economic stability.
Economic and political instability fears
Goldman Sachs analysts wrote Thursday in a note that Draghi’s resignation would cause uncertainty about the government’s future and policy effectiveness.
They stated that they were more worried than any consensus about the possibility of a delaying of implementation of the Recovery Fund or related reforms due to diverging interests and the time required to create a new government. The Recovery Fund is the term used to refer to 191.5 billion eurosTo deal with the shock economics caused by the EU, the EU is expected to provide the following: ($216.68 Billion) coronavirus pandemic.
Funds are disbursed in connection with the completion of promised reforms. Both are crucial for the growth of the Italian economy which has suffered for many years.
Wolfango Piccoli (co-president) of Teneo pointed out the short-term risk to economic recovery in the event Draghi wins the presidency.
No matter Draghi being elected president, it is likely that Italy won’t hold parliamentary election one year sooner than expected. In a Wednesday note, he stated that Draghi’s process for installing a new prime Minister and a government was likely to be chaotic and that there may be a partial reconfiguration of the heterogeneous current ruling coalition.
Italians will vote to elect a new parliament in 2023 after the term of their current parliament ends.
Draghi stated in his press conference at the end of this year that he would be available for the job as president.
“What’s In?” [it]Mario Draghi’s hope is that he can ensure stability for Italy over the long-term and medium-term,” Guido Bodrato of Berenberg told CNBC’s “Street Signs Europe” on Thursday.
He also wanted to make sure political parties are held responsible [for]”Government action.”
It will work.
The tradition is for anyone interested in being elected president of Italy, to indicate their desire but not to publicly announce that they will be running.
Others who could be considered include Silvio Berlusconi (the former prime Minister who was temporarily banned from office following a 2012 conviction for tax fraud); Giuliano Amato who has twice served as prime ministre; Justice Minister Marta Cartabia, former speaker of the lower house Pier Ferdinando Casini and Paolo Gentiloni, former economics commissioner.
“The body of grand electors that will be electing [the]Piccoli said that 1,007 people are currently the president. This includes 949 lawmakers and 58 regional delegates.
To elect a president, two-thirds must be present in the three first rounds. Piccoli noted that after this, it is enough for a simple majority to select a new head-of-state.
Due to the pandemic restrictions, voting rounds could take up to 6 hours. This means that “grand electors”, or grand electors, may be faced with a lengthy process.
As the process is overseen by political parties, “intense political maneuvering behind closed door characterizes election of president.” Piccoli said that past experience suggests that even if a candidate emerges in the first round, new alliances and consensus are often created by the dynamic of the voting.
[ad_2]