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Germany says Italy must reform despite deadlock

The Local · 26 Feb 2013, 10:22

Published: 26 Feb 2013 10:22 GMT+01:00

"The politicians in Rome know that Italy still needs a policy of reform, a policy of (budgetary) consolidation," said Guido Westerwelle, calling for a new government to be formed "as quickly as possible."

"This is not only in the interests of Italy, but the interests of Europe as a whole ... When it comes to beating the debt crisis, we are all in the same boat, whether we live in Germany, France, Italy or Spain," added the minister.

He stressed it was therefore important for politicians in Italy to take responsibility for the bloc as a whole, he added.

Italian elections ended in a stalemate in parliament between right and left after a crunch vote in which the real winner appeared to be a new protest party calling for a referendum on Italy's membership of the euro.

The campaign in Italy was marked by a reaction against the austerity measures pushed by German Chancellor Angela Merkel in a bid to beat the eurozone debt crisis that has propelled the 17-nation bloc into recession.

"Italy plays a central role for a successful overcoming of the European debt crisis and therefore we count on the new government to continue the policy of consolidation and reforms in a consistent matter," concluded Westerwelle.

AFP/mry

The Local (news@thelocal.de)

Your comments about this article

11:32 February 26, 2013 by melbournite
"The politicians in Rome know that Italy still needs a policy of reform"

Err no, the unelected technocrat most associated with your "reform", Monti, got less than 10%. The biggest single party - the 5 star movement - explicity says "up yours" to your "reform"
12:01 February 26, 2013 by smart2012
And to all of this we need to say also thanks to the silly policy of Frau Verkel..
17:08 February 26, 2013 by sonriete
so much for no Diktat.
18:19 February 26, 2013 by schneebeck
That photo alongside that title is just hilarious.
18:26 February 26, 2013 by sonriete
this was my favorite quote in the press this morning;

"European Commission spokesman Olivier Bailly said that, while the Europe's executive body took note of the concerns of the Italian people, it also expected Rome to adhere to promises of reforms."

So to put that in plain english they"take note" of democracy before utterly disregarding the results of democratic elections" HA HA HA
18:45 February 26, 2013 by Englishted
Got to love him coming from a party in steep decline and still trying to bully any country that has the nerve to believe these austerity measures are killing Europe and driving it's electorate to protest parties or extreme parties .

Democracy crying out in it death throngs is totally ignored by those in power a very dangerous game to play.
19:25 February 26, 2013 by IchBinKönig
Isnt the Euro wonderful? When I was a child, before the Euro existed, I visited a gas station in a neighboring European country, and the gas station attendant gave me a dirty look because of my German plates. Now that we have the Euro, when I visit ANY other European country as a German, I get nothing but loving looks and the occasional handy in the bathroom. Isn't the Euro wunderbar? Cant believe people used to have to show a passport at the border and elect their OWN officials. Can you imagine? Oh the humanity!
00:44 February 27, 2013 by skippy01
I don't understand? Italy will not "reform". Its like no one is explaining the reality of economics to Germans. Germany entered the Euro to stop it becoming a zombie economy like Japan. The low valued euro let germany export more than it would with the Dmark. The germans lent money to southern europeans to keep the euro low, knowing they were bad debtors. Then they are surprised that the southern europeans have spent the money and want more.

Germany's choices are simple:

a) Print money like the US (they have increased the money base x4 since 2008), so they can give money to the southern europeans, keep the euro low, but as a result have high inflation in 5-10 years putting everyone on a fixed income in the poor house (pensioners, unemployed etc)

or

b) Leave the euro and go back to the Dmark. Exports will crash with a high Dmark, compnanies will stop hiring, the young will become unemployed and will stop paying taxes. Then in 10 years companies will go broke be unable to pay people pensions, etc etc etc.

Japan followed option b) they have now started to print money like nobodies business to get out of their "frugal, saving" mess.

Unfortunately at the start of a financial crisis the lender has the whip hand. At the end the borrower does, the borrowers in southern europe no have the whip hand, Germany has to keep giving them money otherwise Germany's future will be eaten by older generations pensions. It's sad but I don't see any other way out for the Euro zone.
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