Italian Prime Minister resigns, political and economic instability in the country

ISLAMABAD, July 22 (Alliance News): Italian Prime Minister Mario Draghi tendered his resignation to President Sergio Mattarella after the coalition rejected a confidence vote amid the country’s ongoing political crisis and damage to financial markets.

According to foreign media, the statement issued by the office of President Sergio Mattarella said that the head of state has accepted the resignation of the prime minister, while he was asked to remain in office as a caretaker. Is.

However, the statement did not say what the president would do next, but political sources said he could dissolve the assembly this week and talk about fresh elections in October.

The president was also expected to meet the representatives of both houses of parliament today.

Italy’s governing coalition fell apart on Wednesday after three of the Italian prime minister’s main allies rejected a confidence vote, in which the prime minister had sought to end divisions and renew his controversial coalition.

Political stability in the country has been uncertain for a few months due to the ongoing political crisis in the country, during which the Prime Minister helped to give a strong response from the European side against the Russian attack on Ukraine and the financial markets of the country. Influence was extended.

Italian bonds and stocks, on the other hand, sold off sharply on Thursday as markets welcomed the European Central Bank’s first interest rate hike since 2011.

The yield on benchmark 10-year Italian bonds rose 20 basis points to a three-week high in early trade, while Italian stocks fell 1.8 percent.

Lorenzo Codogno, head of LC Macro Advisors and a former senior official at the Italian finance ministry, said it was a major blow to Italy’s ability to deliver policies and reforms and would lead to delays and disruptions in early elections. And there probably won’t be a budget until the end of the year.

The Italian prime minister had already resigned last week after he failed to get one of his populist allies, the 5-Star Movement, to back him in a confidence vote on inflation-fighting measures.

However, the President rejected his resignation and asked him to go before Parliament to see if they can continue the alliance until the end of Parliament in early 2023.

Addressing the Senate, the Prime Minister appealed for unity and raised issues ranging from the war in Ukraine to social divisions and rising prices before the Senate.

But his ally Five Star Movement once again refused to back the Prime Minister saying that he had not addressed their key concerns.

On the other hand, the right-wing Forza Italia and League parties have decided to stay away from the election, saying they want the prime minister to form a new administration without 5-Star and with new policy priorities.

However, polls say the conservative bloc, which includes people from Italy’s far-right party, is likely to win the election.


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