Italian MPs rejected on Thursday December 21 the ratification of the revision of the European Stability Mechanism (ESM). Italy therefore remains the only state in the euro zone to block the extension of the scope of action of this rescue fund launched in 2012. The subject of heated and constant political debates in recent months, the vote on the ratification of the reform of the MES had been postponed several times. The issue takes on a particular dimension in Italy, where Eurosceptic discourse historically describes the rescue fund as an instrument for placing the economy under supervision and as a threat to Italian sovereignty.
Supported by a motion from the Democratic Party (center left), the ratification was rejected by 184 votes out of 300, coming from Fratelli d’Italia, the party of council president Giorgia Meloni, and its allies from the League (far right). as well as anti-system deputies from the Five Star Movement (M5S), in opposition.
Concluded in 2021 by the euro zone states, the agreement on the reform of the ESM therefore remains a dead letter. Eurogroup President Paschal Donohoe said on Thursday: to regret “ the result of a vote preventing the implementation of a reform “strengthening the resilience and financial stability of the euro zone as a whole and of each of the member states of the euro zone”.
Designed in the wake of the sovereign debt crisis, the MES is a rescue fund set up to support States in financial crisis which see the sustainability of their public debts threatened and are struggling to finance themselves on the markets. The instrument can issue loans, buy government securities, open credit lines. However, its action is subject to conditions and in certain cases, it involves the imposition of reforms intended to restore the financial balance of the State concerned. The treaty establishing the ESM was signed and ratified by Italy in 2012 under the government of technocrat and former European Commissioner Mario Monti.
“An instrument in negotiation”
The revision of the instrument on which the euro zone states agreed in January 2021 must in particular establish additional prerogatives allowing the use of the fund for the rescue of banks in difficulty. Italy approved it but its ratification by Parliament was constantly postponed due to the political sensitivity of the subject. Under the technocratic government of national unity of the former governor of the European Central Bank Mario Draghi who preceded that of Mme Meloni, ratification was thus left aside to avoid a government crisis.
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