Italian Prime Minister Giuseppe Conte is seen addressing senators.
ANDREAS SOLARO | AFP | Getty Images
LONDON – Italy averted further political chaos on Tuesday after Prime Minister Giuseppe Conte survived a vote of confidence in parliament.
The country has been embroiled in fresh political uncertainty for the past week after a smaller party withdrew its support from the coalition government, removing it from the majority in parliament.
Italian lawmakers in the Senate, however, supported Conte on Tuesday at 156 to 140 during a vote, allowing him to remain in office. He was also supported in a vote by Parliament’s lower house on Monday night. Conte will now lead a minority administration in a country prone to political disputes.
Italia Viva, the small political party founded by former Prime Minister Matteo Renzi, left the coalition last week over differences over how to invest future EU funds to boost the Italian economy.
Renzi was blamed for acting in his own political interest by promoting public opinion for his newly formed group. His party on Tuesday night recalled the important vote, rather than vote against Conte and help overthrow the government.
One of the biggest challenges for the current minority government, apart from the raging coronavirus pandemic, is rescuing the Italian economy, where GDP (gross domestic product) is expected to fall by 10% by 2020.
The coalition formed by the Five Star Movement and the Democratic Party, two pro-EU parties, must submit a recovery plan to Brussels for approval by February.
Paolo Gentiloni, European Commissioner for Economic Affairs and who will assess the recovery plans, said on Monday night that fiscal “imbalances are in danger of deepening.”
The eurozone worked before the pandemic to reduce public deficits and lending levels, and there are concerns that fiscal positions will be much worse after the pandemic if the forthcoming stimulus is not invested well.
Third time happy?
This is not the first time Conte has survived internal divisions within his government. The former law professor without political affiliation was the compromise candidate appointed prime minister in June 2018 when the Five Star Movement and the anti-immigration party Lega formed a coalition.
In the summer of 2019, however, Lega asked for a vote of no confidence over the coalition government, but eventually he replaced himself by the Democratic Party in government and what would then become Italia Viva.
Only more than a year since then, Conte remains in power, but with his third form of government.
The bond market has expressed concern over the past week as the latest political dispute in Italy has yielded slightly higher returns.
However, the market reaction has been somewhat curtailed due to the broader European context, where the European Central Bank continues to buy large amounts of government debt and the European Commission will soon be distributing new funds.