World Economy

Italy to Launch New Infrastructure Plan

Italy to Launch New Infrastructure Plan Italy to Launch New Infrastructure Plan

The government will launch a plan aimed at making Italy’s infrastructure safe, a government official said in a newspaper interview on Sunday, after the collapse of a motorway bridge in Genoa killed 43 people.

Giancarlo Giorgetti, undersecretary in the prime minister’s office and a leading member of the League party, said the plan would include motorways, bridges and viaducts but also public buildings such as schools, Reuters reported.

“It will be a maintenance operation with no precedents, with enormous investment in public works,” he said in an interview with Il Messaggero. He did not specify the cost of the plan but said “deficit, GDP or European rules do not exist”.

The government, a coalition between the anti-establishment 5-Star Movement and the League, has started a procedure aimed at revoking concessions held by Autostrade to operate toll highways after the Genoa bridge collapse.

Meanwhile, the end of Greece’s marathon bailout on Monday would mark the closure of the eurozone crisis—if only it weren’t for Italy, and nagging fears that the euro isn’t fixed after all.

European Union authorities will hail as a victory the completion of Greece’s financial-rescue program, an eight-year drama that triggered a wider European sovereign-debt panic. Greece’s economy has begun to grow again, although recovery has far to go. Defying many predictions, Greece has stayed in the euro, thanks to the strength of public support for keeping the currency, even amid one of the deepest economic depressions of modern times.

French President Emmanuel Macron, German Chancellor Angela Merkel and other EU leaders are discussing the next moves to bolster the currency union, building on various overhauls since the crisis. Italy shows it might not be enough.

Renewed market tremors last week over Italian debt, and fresh verbal attacks on Europe’s establishment by politicians in Rome, suggests the specter of destabilizing capital flight from a eurozone country could return.

A first test will come this fall, when Italy’s new populist government must present a budget and explain how it will pay for its costly promises to voters.

“I am as serene as the rainbow,” parliamentary budget committee chairman Claudio Borghi tweeted on Aug. 13 as investors sold off Italian bonds. Either the European Central Bank will guarantee Italy’s debt, “or everything will be dismantled”, said Borghi, a euroskeptic economic adviser to Matteo Salvini, head of Italy’s nationalist League party.

A day later, the prime minister’s office sought to reassure investors with a statement pledging fiscal discipline.

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