Italian politics has been virtually silent since the outbreak of the COVID-19 emergency two weeks ago. The government — composed of left-wing and populist forces — has been backed by the opposition right and far-right parties. Italy currently has the second largest numbers of affected people — with 10,149 current cases; 631 deaths; and 1,004 people who have recovered — with only China having more. To avoid the spread of the virus Italy was entirely quarantined on 9 March until 3 April at the earliest.
The economic consequences of the emergency are going to be enormous and particularly for the two most affected regions, Lombardy and Veneto, which are also the country’s richest. Like other market’s Milan’s Borsa Italiana stock exchange market has entered a downward spiral. The Italian economy is doomed to a recession with GDP falling by at least 0.3%. To try and reduce the impact — or better still to save the situation from collapse — the government will allocate an additional €7.5 billion (US$8,465 million) to hire new doctors and support small- and medium-sized companies. A further €2.5 billion is likely to be added to bring the total funds allocated to tackling the crisis to €10 billion (US$11,355 million). The Treasury is therefore now forecasting a deficit of 2.8% rather than the previous 2.2%.
The main question is what the EU’s response will be to this spending? Italy’s Minister of the Economy & Finance, Roberto Gualtieri, is optimistic because the investment plan falls within the emergency expenditures that is allowed by the Commission in crises. Prime Minister Giuseppe Conte, from the populist 5-Star Movement, claims that the EU cannot oppose this spending. He worries about the infrastructural gaps in the health system that will widen if the virus is not isolated soon which is why Conte also hopes for further economic support from the European Central Bank (ECB).
However, if the economic consequences are clear but undoubtedly negative, the future political landscape after the virus emergency remain unknown.
Before the outbreak of COVID-19 considerable pressure was put on the prime minister by the ‘two Matteo’s’, as they are called in Italy. The first is Matteo Salvini who is the country’s most popular politician and leads the right-wing populist League which is its largest political party. The other is Italy Alive’s Matteo Renzi who — despite being part of the ruling coalition — is critical of many of the proposed reforms. For the moment, they have lowered their guns.
The current government bring together: Italy Alive; the left-wing Democratic Party and Free and Equal parties; and the left-wing populist 5-Star Movement. Renzi is undermining the solidity of the coalition from the inside the government but it is insufficiently popular to pull the plug on the executive and call for snap elections. By contrast the 5-Star Movement is in a major internal crisis and lacks a leader who could provide a new direction to the group to stem is constant fall in the polls. Its forthcoming congress will result in the election of the new front-runner who will determine whether to put an end to the government or to continue to back it.
Within the opposition, Salvini has partially lost the momentum that he gained in the last quarter of 2019. The right-wing Brothers of Italy continue to take votes from the League and the party is steadily growing in the polls. By contrast former prime minister Silvio Berlusconi’s Forza Italia party is becoming increasingly insubstantial.
Giuseppe Conte has been able to retain power thanks to the support of President Sergio Mattarella who does not want snap elections to take place soon because of the current crisis in the Italian economy. There are, however, rumours that he disapproves of Conte’s behaviour during the coronavirus emergency. The premier has been guilty of mismanaging the crisis. This was evident on the night of 7 March when the decision to close Lombardy’s borders was leaked and published on CNN and national press before being officially announced. Consequently, thousands of people left Milan overnight thereby spreading the virus to other areas which, unsurprisingly, upset not only the president but also the general public. If Conte does not regain public trust the aftermath of COVID-19 will be much more deadly for him than the virus. If his government collapses then the eventual elections will probably result in a majority for the centre-right coalition.
Carlo Mongini is a master’s student in Public Policy and Administration at the LSE. He also works as an advisor on Italian affairs and writes for an Italian web-based journal on international relations with a particular focus on Europe.