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Italy’s PM nominee in consultations to finalize cabinet

Italy's prospective new prime minister Giuseppe Conte laboured on Friday to finalize his government team as a battle heated up over the populist coalition's eurosceptic pick for economy minister.

Italy's PM nominee in consultations to finalize cabinet
Giuseppe Conte at the presidential palace. Photo: Vincenzo Pinto/AFP

President Sergio Mattarella on Wednesday approved Conte's nomination to be prime minister of a government formed by the anti-establishment Five Star Movement and the far-right League.

After talks with parliament's political leaders on Thursday, 53-year-old Conte headed Friday morning into a meeting with Five Star leader Luigi Di Maio and League chief Matteo Salvini to discuss their cabinet picks. Mattarella must next endorse the nominations before the government can seek parliamentary approval.

“I will dedicate the whole day tomorrow [Friday] to developing a proposal of government ministers to submit to the President of the Republic,” the future premier said on Thursday.

Italian media reported that Salvini was expected to become interior minister, while M5S leader Di Maio M5S, would head an expanded Ministry of Economic Development and Labour.

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Five questions and answers about what the new government could mean for Italy
Leader of the Five Star Movement Luigi Di Maio and League leader Matteo Salvini. Photo: Tiziana Fabi/AFP

However, the key sticking point has become Salvini's favourite for the Ministry of the Economy, noted eurosceptic Paolo Savona, who once described the euro as a “German cage”.

On Thursday Salvini said that he couldn't see “why anyone would say no to Savona”, who is 81. He added that “there can't be any vetoes” on the ministerial team.

However, without approval from Mattarella – who is considered hostile to Savona – the new government can't get off the ground.

Salvini's comments irritated Mattarella's staff, who underlined that as per the Italian constitution the discussion over ministers was now a matter for Conte and the head of state.

“The issue isn't vetoes but the unacceptability of diktats towards the prime minister and president of the republic,” the president's office said in a statement.

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The suspense over the name of the future finance minister of the third largest economy in the eurozone is causing concern in Brussels and on the financial markets. On Friday the difference in yield on Italian ten-year sovereign bonds compared to Germany's crossed the 200-mark level before falling back slightly.

Officials in Brussels have voiced concern that Italy could trigger a new eurozone crisis by refusing to stick to the bloc's public spending and debt targets.

The joint government programme unveiled by Five Star and the League last week pledges anti-austerity measures such as drastic tax cuts, a monthly basic income and pension reform rollbacks, which Di Maio and Salvini claim will boost growth.

The European Commission's vice-president for the euro, Valdis Dombrovskis, issued a new warning to Italy on Friday as he arrived at a meeting with EU finance ministers.

“Our message from the European commission is very clear: that it is important Italy continues to stick with responsible fiscal and macro-economic policies,” Dombrovskis told reporters.

That was the second time in a week that he had warned Italy against “irresponsible” spending, and on Thursday the European Central Bank (ECB) offered similar guidance. “A loosening of the fiscal stance in high-debt countries could impact the fiscal outlook and, by extension, market sentiment” towards governments when they try to sell bonds, it said in its bi-annual financial stability report.

The ECB holds around 17 percent of Italy's €2.3 trillion public debt. 

READ ALSO: ECB warns Italy against reckless spending


Photo: Daniel Roland/AFP

By Terry Daley

ENERGY

Italy to have enough gas ‘to make it through winter’

Italy’s current gas stocks should suffice for the upcoming winter but the government should be wary of unforeseen supply-chain issues, says ENI CEO Claudio Descalzi.

Italy to have enough gas 'to make it through winter'

Despite recent issues regarding Russian supplies, Italy should have enough gas to make it through the winter, said Claudio Descalzi, the CEO of Italian energy giant ENI, on Thursday.

“Russian gas has effectively been replaced” and the current conditions should afford the country some “tranquillity” ahead of the winter season, he added.

READ ALSO: Russia will resume gas deliveries to Italy, Gazprom says 

Prior to Russia’s invasion of Ukraine, gas from Moscow accounted for about 40 percent of Italy’s annual gas imports. 

At the present time, however, Russian gas only contributes to around 10 percent of the country’s demand, with deliveries sitting around “10-15 million cubic metres per day”, said Descalzi.

Logo of Russian energy giant Gazprom.

Russian gas, which is supplied by energy giant Gazprom, currently accounts for only 10 percent of Italian gas imports, down from 40 percent. Photo by Kirill KUDRYAVTSEV / AFP

ENI’s CEO also expressed contentment over the country’s gas-storing efforts, saying that national stocks “will soon be completely full” – according to the latest available indications, 90 percent of them have already been filled up. 

Descalzi’s words of reassurance came only a day after Russian energy giant Gazprom resumed gas deliveries to Italy. 

As previously reported by The Local, the supply of Russian gas to Rome had been suspended last Saturday due to disagreements over contractual obligations between Gazprom and Austrian energy regulator E-Control.

The incident had raised reasonable fears of a long-term suspension of Russian gas supplies, with Ecological Transition Minister Roberto Cingolani and Descalzi both stepping in over the weekend to reassure citizens about Italy’s gas reserves.

That said, despite the relative stability of Italy’s current energy status, a measure of uncertainty still lingers on. 

Descalzi himself admitted on Thursday that “technical issues on the part of suppliers” or an “exceptionally cold winter” might cause problems for Italy’s energy plans.

That’s why, he said, “regasification plants are so vital for next year’s winter” and to give further stability to the system.  

Two workers ride bicycles at the Barcelona's Enagas regasification plant.

Regasification plants will be vital to Italy’s plans to rely on liquefied natural gas supplies in the future. Photo by Josep LAGO / AFP

READ ALSO: What does the shut-off of Russian gas supplies mean for Italy?

Briefly, though Italy has chosen to bet heavily on Algerian gas in order to wean itself off Russian supplies – Algeria will supply Rome with as many as nine billion cubic metres of gas next year – the country will also receive a total of four billion cubic metres of LNG (Liquefied Natural Gas) from different African partners over the course of 2023.

Regasification plants, which essentially work to convert liquid gas to its gaseous state, will then be essential to unlock the potential of the new LNG supplies. 

Italy currently has three active regasification plants, but the construction of a fourth one near Piombino, Tuscany is now under consideration.

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