Ursula von der Leyen’s gift to Rome might yet turn out to be a poisoned chalice.
The nomination of former Prime Minister Paolo Gentiloni for economy commissioner in the next European Commission has been described as a reward for Italy replacing a Euroskeptic coalition with a government bent on improving relations with the EU.
“The most important portfolio our country ever got,” celebrated La Stampa in an editorial on Wednesday, even as many in Europe reacted to the announcement with disbelief, given that Italy has spent the past year flouting the EU’s budget rules.
Much to the relief of many EU capitals, the anti-establishment 5Star Movement finalized a break with their former coalition partner, the far-right League, and instead formed a government with Gentiloni’s center-left Democratic Party (PD).
The EU has every reason to bring Rome back into the fold and give the new government a leg up. Beyond its far-right rhetoric and policies, the League’s rise triggered alarm in capitals across the Continent with its ambiguous stance on a potential exit from the euro, its easygoing approach to Italy’s staggering public debt and its pro-Kremlin line.
With the League sidelined, EU countries are pitching in to help the new executive. Significantly, this week French President Emmanuel Macron will be the first EU leader to visit Rome since the 5Stars-PD government took office. The trip comes after months of tensions between his government and the 5Stars-League coalition.
Von der Leyen has her own reasons to help the new government: Prime Minister Giuseppe Conte and the 5Stars were essential to her confirmation, with Conte backing her in the Council and the 5Stars helping to secure her razor-thin majority in the Parliament.
Yet there is a danger that the incoming Commission president’s favor of an economic portfolio for Italy could backfire. Analysts and PD officials have expressed concern that Gentiloni’s job might turn into a trap for the new government if he ends up having to enforce unpopular economic rules or austerity measures.
“If he is too soft on Italy, he’ll be accused by Nordic hawks of favoritism,” as one Italian newspaper put it. “If he is too hard, he will provide [League leader Matteo] Salvini the occasion to call him and the PD ‘slaves of Brussels.'”
Little budget flexibility ahead
The new government is already facing an uphill battle. It’s far more popular in Brussels than at home: A survey published by newspaper Corriere della Sera showed that just 36 percent of Italians support the new coalition. The League-5Stars government, on the other hand, had a 61 percent approval rating at the end of July.
To win over voters, the new government hopes for EU support on two hot-button issues in particular: the budget and migration.
Conte, who has repeatedly called for greater flexibility in EU fiscal rules, was careful to reassure less lenient capitals that “our target is to reduce the debt” when he was in Brussels last week to meet with key officials, both incoming and outgoing, in EU institutions.
But he also said that his government wants to achieve debt reduction not with austerity but “through economic growth and investments,” adding that Italy would need “some time” to reach fiscal targets and invest in the green economy, digitalization and the revival of its poorer south, the so-called Mezzogiorno.
Yet while Italy might hope for a little more flexibility with Gentiloni in charge of the economic portfolio, the commissioner will likely have little room for maneuver. Austria’s Sebastian Kurz, the country’s former and likely next chancellor, has already announced his opposition to softening budget rules, saying Vienna is “not prepared to pay Italy’s debts.”
Gentiloni will also have to work closely with — and report to — Executive Vice President Valdis Dombrovskis, a Latvian in charge of economic affairs, who is considered a hawk.
At the same time, surveys show that center-left voters are the only Italian demographic with a high amount of trust in Brussels. If Gentiloni ends up becoming the EU’s “austerity man,” the chances of the PD — and the new government in general — halting the rise of the League would likely become even slimmer than they are now.
Yet top PD officials seem not to be too worried: Gentiloni is “one of the most prestigious names in the new Commission,” said Brando Benifei, the head of the PD delegation in the European Parliament, adding that his appointment is “a great opportunity for a fresh approach on economic, fiscal and monetary affairs.”
EU dilemma
As for getting the EU’s help on migration, Italy has high hopes for the von der Leyen Commission.
“We expect von der Leyen to fulfill her promise to put at the center of her program migration and real European policy of managing the flows,” said Laura Ferrara, a 5Star MEP.
There are signs of movement on the issue: A temporary mechanism to redistribute disembarked migrants could soon be signed at a summit in Malta between the interior ministers of Germany, France, Italy and Malta, diplomats say.
Yet Rome might nevertheless want to scale back its expectations on that front as well, as the Commission depends on individual member countries in this regard. Diplomats say that EU countries are keen to provide a hand to Rome on migration, but that one of the sticking points is that they don’t want to relocate all migrants, only asylum seekers.
For now, the 5Stars could be the most immediate beneficiaries of the newfound pro-EU coalition in Rome. The anti-establishment party was key in stopping Salvini, but its attempts to join the Greens and the liberal-centrist Renew Europe in the European Parliament have been so far unsuccessful due to their previous alliance with the League, leaving them isolated in Brussels.
But the League’s exit from government opens new possibilities, or so 5Stars lawmakers hope. “Many times our work in the Parliament was recognized by other political forces, but then we were penalized by this alliance with Salvini,” said Ferrera. “Now that we have overtaken this obstacle, we surely expect we can capitalize [on that].”
The EU, meanwhile, faces a dilemma when it comes to Italy. On the one hand, the far right remains a threat as long as support for the new government stays low. “My fear is that without addressing the domestic concerns in Italy, we might in two years’ time [again] see that pro-Kremlin republic,” said an EU diplomat.
But on the other hand, the EU cannot cave to pressure from Rome on issues such as fiscal rules just because the League looms in the background, the diplomat said, warning that countries could otherwise use the threat of far-right parties rising “to extract concessions” from Brussels and other member states.
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