Micheál Martin
Ceist:314. Deputy Micheál Martin asked the Minister for Finance his views on whether the result of the Italian referendum will cause another economic and political crisis in the eurozone. [39413/16]
Amharc ar fhreagraTuesday, 17 January 2017
Ceisteanna (314)
Freagraí scríofa
On Sunday 4th December 2016 Italians voted on proposals for constitutional reform proposed by the then Italian Prime Minister Matteo Renzi. By a majority of 59 per cent to 41 per cent the referendum was defeated. Mr Renzi has subsequently resigned and a new Prime Minster, Mr Paolo Gentiloni has been sworn in. It is expected that Mr Gentiloni, the previous Italian Foreign Minister, can provide the required continuity as the Italian political system will inevitably need some additional time to take stock and agree a way forward.
It is important to note that this referendum was about internal constitutional reform in Italy, not about support for the European Union. In this sense it is entirely different from the UK referendum in June. The only political parties which took an explicitly anti-EU line during the campaign, and after the results, have no more than 15 per cent of the vote. And the 59 per cent of No voters will certainly have included people who are pro-European but just did not support the proposed constitutional reforms.
I am confident that the euro area is now sufficiently robust to deal with the fallout from the referendum result. In this regard, I note that there was a relatively muted market reaction to the result. For instance, the spread (that is the difference in 10-year yields) between government bonds of Italy and Germany has remained stable at around 1.7 per cent since the referendum result. In other words, from a financial market perspective, a "No" vote had been priced in.
So, in summary, there is little, if any, evidence at this stage to suggest that the outcome of the referendum has had a fall-out for the euro area as a whole.