- Title: Italy should continue economic reforms, EU finance ministers say
- Date: 5th December 2016
- Summary: BRUSSELS, BELGIUM (RECENT) (REUTERS) EXTERIOR OF EUROPEAN UNION COUNCIL BUILDING EU FLAGS
- Embargoed: 20th December 2016 10:42
- Keywords: Italy referendum constitution European Union Renzi Schaeuble Dijsselbloem Gramegna German Finance Minister euro zone Eurogroup Moscovici
- Location: BRUSSELS, BELGIUM
- City: BRUSSELS, BELGIUM
- Country: Belgium
- Reuters ID: LVA0015BLXHL3
- Aspect Ratio: 16:9
- Story Text: EU Finance Ministers said on Monday (December 5) Italy should continue economic reforms following the departure of Italian Prime Minister Matteo Renzi, who decided to resign after his defeat in a referendum on constitutional amendments.
The chairman of the Eurogroup, Dutch Finance Minister Jeroen Dijsselbloem, told reporters that Italy should continue the economic reforms started by Renzi.
"We took note of the outcome and it's of course up to the Italian president now to take further decisions on the democratic process, because this is what it is: it's a democratic process and it doesn't really change the situation economically in Italy or in the Italian banks. The problems that we have today are the problems that we had yesterday and they still have to be dealt with and that process will continue as far as I am concerned so let's wait for the outcome of the political process," Dijsselbloem said before a meeting of euro zone finance ministers.
Also reacting to the result of the referendum, European Commissioner for Economic and Financial Affairs Pierre Moscovici said Italy could handle the fallout from Renzi's resignation and that the euro zone as a whole could manage all kinds of political shocks.
"I am very confident in the capacity of the euro zone to resist to all kind of shocks. I think we now have a very solid system, a solid governance, a strong banking union so I'm confident," Moscovici said.
Echoing Dijsselbloem's comment, German Finance Minister Wolfgang Schaeuble said he had spoken to his Italian counterpart and believed that it was important for Italy now to have a functioning government that remains on the path of reforms.
"The situation in the markets is relaxed. Now we will see how it continues in Italy. Those responsible know the situation is not easy. Italy urgently needs a functioning government. I hope that they will continue on the path of reforms, notwithstanding the fact that the Italian people has not accepted constitutional reforms like that," Schaeuble said.
Luxembourg Finance Minister Pierre Gramegna paid tribute to the work undertaken by Renzi after he became prime minister in February 2014.
"I think that the Italian government worked well in the last two years because they fulfilled their obligations, the deficit is under 3% and the situation is better today than it was two years ago," Gramegna said.
Italian Finance Minister Pier Carlo Padoan, who was skipping the Brussels meeting, is among possible successors to Renzi.
The former mayor of Florence's decision to quit after just two and a half years in office deals a blow to the European Union, already reeling from multiple crises and struggling to overcome anti-establishment forces that have battered the Western world this year.
The euro briefly tumbled overnight to 20-month lows against the dollar, as markets worried that instability could reignite an EU debt crisis and deal a hammer blow to Italy's fragile banking sector, especially the troubled Banca Monte dei Paschi di Siena. However, by early in the European morning it had largely rebounded.
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