BRUSSELS (MNI) – Italian Prime Minister Silvio Berlusconi has
promised to send to Brussels before Wednesday a letter outlining
measures he will take to promote growth in the Italian Economy, a
European Commission spokesman said Tuesday.
EU leaders, particularly Germany’s Angela Merkel and France’s
Nicolas Sarkozy, demanded over the weekend that Italy do more to
reassure Europe and financial markets that the Eurozone’s third-biggest
economy would implement tough measures to restore economic health.
Italy’s EU partners have doubts about Berlusconi’s willingness and
ability to enact the tough fiscal, structural, and judicial reforms that
could improve Italy’s competitiveness and ward off contagion.
With just hours left to keep his promise, made on the margins of
Sunday’s summit, Berlusconi might struggle to provide such assurances
since his plan for pension reform has been stonewalled by his junior
coalition partner, the Northern League. A cornerstone of that plan would
be to raise the retirement age both in the public and private sectors to
67, from 65.
Nevertheless, the European Commission has said it is “fully
confident” that Italy will meet its commitments as planned, including
sending the letter to Commission President Jose Manuel Barroso and
European Council President Herman Van Rompuy, who chairs the summits of
EU leaders.
Confrontations in which EU leaders gang up on a single
underperforming country are likely to become more frequent as new
economic governance rules strengthen peer pressure, a Commission
spokesman said.
EU and Eurozone leaders meeting in Brussels on Wednesday hope to
agree on a multi-pronged strategy to restore confidence to government
bond markets and financial institutions. The package will include
leveraging the Eurozone’s bailout fund to give it greater financial
capacity, and a reworked debt restructuring plan for Greece.
–Brussels bureau: +332495228374; pkoh@marketnews.com
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