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#Italy government deal looks closer as #PD drops #Conte veto

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A deal on forming a government in Italy between the 5-Star Movement and the opposition Democratic Party (PD) looked closer on Monday (26 August) after the PD dropped a veto on Giuseppe Conte (pictured) serving another term as prime minister, write Angelo Amante and Giselda Vagnoni.
Conte resigned last week. His reinstatement, insisted on by anti-establishment 5-Star but resisted by the centre-left PD, had been presented as the main stumbling block to a deal between the two traditionally antagonistic parties.

“There are no vetoes, we want to talk about policies,” the PD’s Senate leader Andrea Marcucci told reporters asking him about the block on Conte, as he left a meeting of the party’s top brass including leader Nicola Zingaretti.

Italy’s 10-year bond yield hit the day’s low of 1.323% and the spread with German Bunds fell below 200 basis points on the comments.

Leaders of 5-Star were meeting in a Rome hotel to decide on their response.

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The movement is divided between factions who favour a deal with the PD and others who believe it would shatter the party’s anti-establishment image and accelerate the decline in voter support it has suffered over the last year.

Conte quit last week after the far-right League party, aiming to capitalise on its surging support in polls, declared its 14-month coalition with 5-Star was dead and asked for a snap national election.

Conte, who is close to 5-Star, was a virtually unknown lawyer when he was chosen by the League and 5-Star to lead their government following an inconclusive March 2018 election. He is now Italy’s most popular politician, according to opinion polls.

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The move to sink the government by League chief Matteo Salvini has not gone to plan, as 5-Star and the PD have moved to try to form an alliance of their own, pushing the League into opposition.

Only the head of state, Sergio Mattarella, can dissolve parliament and he will do so only if parties are unable to reach a deal on forming a new government.

He gave the PD and 5-Star until Tuesday (27 August) to make progress in putting together a new coalition, whose top priority would be to approve a 2020 budget. Failing that, Mattarella made clear he would call an early election in the autumn.

On Friday (23 August), 5-Star and the PD made early progress in finding common ground on policy, but the former had insisted Conte should serve another term while the PD said it wanted someone else, without publicly putting forward a name.

Opinion polls suggest the League has lost between five and 7 percentage points since pulling the plug on the government though it remains easily the most popular party, followed by the PD and 5-Star.

European Commission

NextGenerationEU: European Commission disburses €231 million in pre-financing to Slovenia

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The European Commission has disbursed €231 million to Slovenia in pre-financing, equivalent to 13% of the country's grant allocation under the Recovery and Resilience Facility (RRF). The pre-financing payment will help to kick-start the implementation of the crucial investment and reform measures outlined in Slovenia's recovery and resilience plan. The Commission will authorise further disbursements based on the implementation of the investments and reforms outlined in Slovenia's recovery and resilience plan.

The country is set to receive €2.5 billion in total, consisting of €1.8bn in grants and €705m in loans, over the lifetime of its plan. Today's disbursement follows the recent successful implementation of the first borrowing operations under NextGenerationEU. By the end of the year, the Commission intends to raise up to a total of €80 billion in long-term funding, to be complemented by short-term EU-Bills, to fund the first planned disbursements to member states under NextGenerationEU.

The RRF is at the heart of NextGenerationEU which will provide €800bn (in current prices) to support investments and reforms across member states. The Slovenian plan is part of the unprecedented EU response to emerge stronger from the COVID-19 crisis, fostering the green and digital transitions and strengthening resilience and cohesion in our societies. A press release is available online.

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Cyprus

NextGenerationEU: European Commission disburses €157 million in pre-financing to Cyprus

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The European Commission has disbursed €157 million to Cyprus in pre-financing, equivalent to 13% of the country's financial allocation under the Recovery and Resilience Facility (RRF). The pre-financing payment will help to kick-start the implementation of the crucial investment and reform measures outlined in Cyprus' recovery and resilience plan. The Commission will authorise further disbursements based on the implementation of the investments and reforms outlined in Cyprus' recovery and resilience plan.

The country is set to receive €1.2 billion in total over the lifetime of its plan, with €1 billion provided in grants and €200m in loans. Today's disbursement follows the recent successful implementation of the first borrowing operations under NextGenerationEU. By the end of the year, the Commission intends to raise up to a total of €80bn in long-term funding, to be complemented by short-term EU-Bills, to fund the first planned disbursements to member states under NextGenerationEU. Part of NextGenerationEU, the RRF will provide €723.8bn (in current prices) to support investments and reforms across member states.

The Cypriot plan is part of the unprecedented EU response to emerge stronger from the COVID-19 crisis, fostering the green and digital transitions and strengthening resilience and cohesion in our societies. A press release is available online.

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Belgium

EU Cohesion policy: Belgium, Germany, Spain and Italy receive €373 million to support health and social services, SMEs and social inclusion

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The Commission has granted €373 million to five European Social Fund (ESF) and European Regional Development Fund (ERDF) operational programmes (OPs) in Belgium, Germany, Spain and Italy to help the countries with coronavirus emergency response and repair in the framework of REACT-EU. In Belgium, the modification of the Wallonia OP will make available an additional €64.8m for the acquisition of medical equipment for health services and innovation.

The funds will support small and medium-sized businesses (SMEs) in developing e-commerce, cybersecurity, websites and online stores, as well as the regional green economy through energy efficiency, protection of the environment, development of smart cities and low-carbon public infrastructures. In Germany, in the Federal State of Hessen, €55.4m will support health-related research infrastructure, diagnostic capacity and innovation in universities and other research institutions as well as research, development and innovation investments in the fields of climate and sustainable development. This amendment will also provide support to SMEs and funds for start-ups through an investment fund.

In Sachsen-Anhalt, €75.7m will facilitate cooperation of SMEs and institutions in research, development and innovation, and provide investments and working capital for micro-enterprises affected by the coronavirus crisis. Moreover, the funds will allow investments in the energy efficiency of enterprises, support digital innovation in SMEs and acquiring digital equipment for schools and cultural institutions. In Italy, the national OP ‘Social Inclusion' will receive €90m to promote the social integration of people experiencing severe material deprivation, homelessness or extreme marginalisation, through ‘Housing First' services that combine the provision of immediate housing with enabling social and employment services.

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In Spain, €87m will be added to the ESF OP for Castilla y León to support the self-employed and workers who had their contracts suspended or reduced due to the crisis. The money will also help hard-hit companies avoid layoffs, especially in the tourism sector. Finally, the funds are needed to allow essential social services to continue in a safe way and to ensure educational continuity throughout the pandemic by hiring additional staff.

REACT-EU is part of NextGenerationEU and provides €50.6bn additional funding (in current prices) to Cohesion policy programmes over the course of 2021 and 2022. Measures focus on supporting labour market resilience, jobs, SMEs and low-income families, as well as setting future-proof foundations for the green and digital transitions and a sustainable socio-economic recovery.

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