EU invites Italy to take the right steps

The Eurogroup will have to wait and see what Italy’s next political steps are, what its government will do and what its president decides, President of the Eurogroup Jeroen Dijsselbloem said Monday.

Attending a Eurogroup ministers’ meeting in Brussels, Dijsselbloem’s remarks came after Italian Prime Minister Matteo Renzi said he would resign after losing Sunday’s constitutional referendum.

“We agreed that at this juncture it’s difficult for the Italian government to commit now to take additional measures. Therefore the Eurogroup invites Italy to take necessary steps in the near future to ensure that the budget will be compliant,” Dijsselbloem said.

Pointing to moderate market reactions so far, Dijsselbloem stressed the Italian economy, with its strong institutions, was one of the largest in Europe.
The Eurogroup said it invited Italy to take the “necessary steps” to ensure its 2017 budget complied with EU rules. Italy’s high level of debt was a matter of concern and it should step up its privatisation efforts, the Eurogroup said.

“There’s no systemic risk to the euro,” French Finance Minister Michel Sapin had told reporters before the meeting.

Sapin claimed the Italian referendum was a vote against a change in the country’s constitution, not on EU membership, and added: "Italians are still in favor of the European Union.” "Italy is a profoundly European country," he added.