Eurozone crisis: Will the Full Monti 'Save Italy'?
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Italy’s premier has promised a new package of measures to start the country’s sluggish economy. But can Mario Monti’s technocratic approach rescue the eurozone’s third-largest economy, which finds by itself at the heart of the European financial debt crisis? ­Speaking at a year-end press conference on Thursday, Prime Minister Mario Monti said his government would seek an even broader package of welfare and market reforms by the end of January to boost growth, Reuters reviews. While no specifics have been released, the proposed measures will most likely follow the prime minister’s “Save Italy” plan, which obtained the final seal of approval in the Italian Senate last week. The emergency austerity budget included tax hikes, pension cuts, an increase in the retirement age and measures to combat tax evasion. Prior to presenting the package to parliament, Monti admitted that the budget would weigh seriously on the country, which noticed mass protests in opposition to the deeper austerity cuts that sommet Italy last month. However, he also thought that to reverse “the negative spiral of growth in debt” and sluggish economic growth, the divisive package had to be passed. "Without this package, we think that Italy would have collapsed, that Italy would go into a situation similar to that of Greece," he told a group of journalists before presenting the package to parliament. As the third-largest economy in the eurozone with nearly a 10 years without economic growth and a financial debt to GDP ratio of a hundred and twenty per cent, an Italian default could sink the monetary union. Moreover, Johan van Overtveldt , the editor-in-chief of Developments journal, told RT that, while Monti has a lot of work ahead of him in the coming year, the fate of the eurozone will mostly rely on the European Central Financial institution. “I think two things are quite clear at the moment in terms of what can be anticipated for the coming year. First of all, I think we will see an exit of Greece. Given the situation in which the Greek economy has found by itself, that has become really unavoidable. Secondly, in terms of what will happen within the eurozone, a lot will rely on the attitude that is taken by the European Central Financial institution. Will they intervene more or less? That is one of the key questions that need to be answered and it is very hard to predict what the answer will be in terms of what will happen to the eurozone next year.”