“The UK isn’t the only country to hold a make-or-break referendum this year. After Brits go to the polls in June to vote on EU membership, Italians will have a say on reforms to its Senate, the upper house of parliament, in October. If approved, the reforms could improve the stability of Italy’s political set up and allow prime minister Matteo Renzi to push through laws aimed at improving the country’s economic competitiveness.
If denied, Renzi’s government will fall, plunging Italy back into the type of political chaos last seen after the ousting of former Prime Minister Silvio Berlusconi, according to Deutsche Bank. “If the referendum is rejected, we would expect the fall of Renzi’s government. Forming a stable government majority either before or after a new election could become extremely challenging even by Italian standards,” Deutsche Bank analysts led by Marco Stringa said in a note to clients.
A political mess can quickly turn into a financial and economic mess. And Italy cannot afford that at the moment…. (hier)