Italian MPs block reform of the euro rescue fund
The MPs rejected the proposal for ratification by 184 votes to 72, with 44 abstentions. However, the voting behavior revealed a split within the government camp: in contrast to Meloni's FdI and the Lega, Foreign Minister Antonio Tajani's Forza Italia abstained, among others. In contrast, the opposition populist Five Star Movement voted with the FdI and Lega. The members of the centre-left opposition voted in favour of ESM ratification.
Italian observers now expect that Meloni's government majority will soon submit its own draft for ratification of the ESM reform to parliament. It could attach conditions to Italy's approval - such as a concession from the other EU states on the rules of the EU Stability Pact. The EU states only agreed on its reform on Wednesday after a long struggle.
Founded in 2012 in the midst of the euro financial crisis, the ESM is intended as a kind of fire department to prevent a conflagration in Europe in the event of financial crises. The fund can deploy 500 billion euros to combat crises. It will remain in force in its current form until its reform, which has now been blocked by Italy, comes into force.
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- Giorgia Meloni, the leader of FdI, expressed her disappointment with the MPs' decision to block the ESM reform ratification.
- Despite the obstacle posed by Italy, the EU states are hopeful that they can still proceed with the reform of the Eurozone's euro rescue fund.
- Forza Italia, headed by Antonio Tajani, maintained a neutral stance during the vote, abstaining instead of actively seconding or opposing the reform.
- The Eurozone faces an uncertain future as the reform of the ESM, which could provide much-needed financial support during crises, remains stalled due to Italy's opposition.
- The EU Stability Pact, a key component of the ESM, could be amended to address Italy's concerns in order to secure its approval and enable the fund's reform.
- The opposition populist Five Star Movement and Lega both supported the ESM reform ratification, while the centre-left opposition championed its cause in the House of Representatives.
- The euro rescue fund, known as the ESM, has been crucial in maintaining financial stability in the Eurozone since its establishment in 2012, particularly during times of crisis.
- The Block, a potentially influential coalition within the Italian government, could play a pivotal role in determining whether the ESM reform advances or remains in limbo.
Source: www.stern.de
