Italian Prime Minister Giorgia Meloni sharply criticized, Thursday, December 22, the European Stability Mechanism (ESM), the rescue fund for the euro zone, the reform of which must be debated in the national Parliament.
“The question I would like to ask, before entering into the debate which will take place in Parliament on the ratification or not of something not very useful, is: can we make this tool useful? »she said on the TV show door to door broadcast on the public channel Rai 1.
“As long as I count for something, I can sign with blood the fact that Italy will not call on the MES”she noted.
Created in 2012, the ESM borrows on the financial markets to provide loans at subsidized rates to States in the euro zone in difficulty, which must in return implement reforms to improve their competitiveness and clean up their public finances.
“Too strict” conditions
This mechanism has a maximum lending capacity of 500 billion euros intended to help, in the event of financial difficulties, countries sharing the single currency. It is the subject of deep mistrust in Italy, where it is considered an instrument of austerity imposed by northern Europe on southern countries.
At the beginning of 2021, the Member States of the euro zone had signed a treaty strengthening the role of this fund, paving the way for its ratification by national parliaments before its entry into force. For now, Italy is the only country in the euro zone not to have ratified the reform.
The use of this mechanism comes with strict reform conditions, like those imposed on Greece during its bailout in 2015, when the left-wing government of the time lost access to financial markets.
“Why has MES never been used by anyone? Because the conditions are too strict and because the MES is a privileged creditor, that is to say that in the event of difficulty, it is the first to be reimbursed”added M.me Meloni.