Governments and investors across Europe are looking nervously at Italy as they try to piece together what the collapse of Mario Draghi’s government will mean for the EU’s €800bn Covid recovery fund — of which Rome is the largest recipient.
The fund is the EU’s most ambitious joint economic project since the birth of the euro, bringing member states together to guarantee the issuance of joint debt by the European Commission on an unprecedented scale. Italy alone has been allocated €200bn of EU funds, considered vital to reboot the country’s chronically underperforming economy.
Like the other countries, Italy has agreed an ambitious timetable of reform milestones and investment targets to unlock tranches of EU money. But a premature election campaign casts doubt on whether the country can hit this year’s deadlines — a concern acknowledged by president Sergio Mattarella as he dissolved parliament last week.