Italy is on the verge of yet another political crisis as members of its government question Prime Minister Giuseppe Conte’s plan for economic recovery following the Covid-19 crisis.
The latest political dispute comes at a critical moment, with the number of Covid infections and deaths in Italy among the highest in Europe. Italy’s GDP is expected to have shrunk 10% in 2020.
Italy is one of the main beneficiaries of European Union funds which is expected to distribute over 200 billion euros in grants and loans to the country. Italy has the second highest public debt pile in the EU and its economy was struggling prior to the pandemic. The objective is to figure out the best way to distribute these funds without substantially increasing Italy’s public debt.
Former Prime Minister Matteo Renzi is threatening to pull his support for Conte if the recovery plan doesn’t improve. Experts state that there will be a change in leadership very soon if Conte’s plan isn’t approved and that will likely be at the end of this week.
Conte is expected to submit his revised economic recovery plan to the cabinet for approval at the end of the week.