18 June 2003

EZA 541 - Italy-Politics

Italy's Berlusconi considers early national elections
Prime Minister Silvio Berlusconi is considering calling early Italian national elections in Jun04, coinciding with the European Parliament election, to head off a strong opposition challenge headed by European Commission President Romano Prodi, and save his disintegrating coalition. As well, the Berlusconi government is becoming more intensely anti-Europe even as it prepares the six-month Italian presidency of the EU starting at the end of this month. Relations between Berlusconi’s Forza Italia party, the National Alliance and the Northern League are worsening. This is near certain to block any economic reforms including the much-needed pension overhaul that Berlusconi and Economy Minister Giulio Tremonti have been promoting. Forza Italia’s recent clear defeat in local elections in the Region of Friuli by the left-wing Olive Tree coalition is producing panic reactions in Rome: volatile Northern League leader Umberto Bossi is threatening to leave the coalition. A note on the coming Italian presidency by our friends at the Centre for European Policy Studies in Brussels, written by CEPS founder Peter Ludlow, was so sharply critical of the Berlusconi government that it has caused some waves in Italian political circles.

SummaryAsset Conclusions: Potential political instability re-appears in Italy, threatening leadership role during country’s 2H03 EU presidency; may hit euro

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© Graham Bishop