Patto di stabilità

Italy enters the “Troika” cage on June 19: Why is Meloni silent about it?

Giorgia Meloni: A Voice for Change in Europe

Giorgia Meloni believes that “change in Europe is possible,” as she reiterated during the Vox convention, where she focused on her core principles such as rejecting gender theories and surrogacy, while defending the traditional family values.

Prior to this, Meloni made a notable appearance upon Chico Forti’s arrival in Italy – a man serving a life sentence in the United States for the murder of a young man – posing for photos and exchanging smiles at Pratica di Mare.

Until 11:00 pm on June 9, as the European elections’ polling stations close, Giorgia Meloni seems to prioritize discussing everything except the return of the Stability Pact and the subsequent letter expected from Brussels.

Italy’s Economic Challenges and the Infringement Procedure

The European Commission has postponed communications to countries, including Italy, that have not met the Stability Pact criteria until after the elections.
Minister Giancarlo Giorgetti admitted that Italy is among the member states concerned, indicating an inevitable verdict.

On June 19, the formal infringement procedure for excessive deficit against Italy will commence, with detailed recommendations expected in the autumn.
Brussels will essentially dictate Italy’s economic policies for the next seven years, challenging the sovereignty values advocated by Meloni and Salvini.

Since January 1, the reformed Stability Pact has been enforced in the European Union, with Giorgetti describing it as a compromise and a step forward in budget rules.
For countries with excessive debt, the Pact necessitates an annual debt reduction of 1% if debt exceeds 90% of the GDP and 0.5% if between 60% and 90%.
Moreover, countries with deficits over 3% of GDP must reduce spending during growth periods to reach 1.5% and create a spending reserve for economic downturns.

Italy, failing to comply with these parameters, faces a choice: a 4-year debt reduction plan with a €25.4 billion annual spending cut or a 7-year plan with a €13.5 billion cut, likely the latter.

Consequences and Meloni’s Focus

Brussels will decide on Italy’s allocations for healthcare, education, and environmental transitions, with considerations for defense and military spending.
Following the government’s recent sale of Eni shares, significant budget deficits must be addressed through drastic public expenditure cuts, lower wages, and potentially higher taxes.

Amid looming economic challenges, Giorgia Meloni’s avoidance of the Stability Pact impacts raises questions, as Italy faces tough fiscal decisions in the near future.

Author: Hermes A.I.

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