Sputnik discussed the importance of Italy’s political stability for the global markets with Lorenzo Codogno, Visiting Professor in Practice at the European Institute of the London School of Economics and Political Science, former chief economist and director general at the Treasury Department of the Italian Ministry of Economy and Finance.
Sputnik: The political uncertainty has sent shockwaves across the global markets. Why is Italy’s political stability an important factor for the markets?
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Sputnik: Would you agree that there are all chances that the ongoing turmoil in Italy would lead to even broader instability within the eurozone, considering the fact that there will probably be snap elections and it's quite likely the eurosceptic parties will only strengthen their position?
Lorenzo Codogno: First of all, it’s not clear what’s going to happen, because the latest pieces of information seem to suggest that maybe there is a way to kind of re-launch the idea of the Five Star joining forces together with the League on a platform which is less anti-Europe, so they might actually commit on euro participation and fiscal sustainability. By doing so they might actually get the green light from the president. However, the risk is clear that if this turmoil continues, it might spread out into other countries in Europe and, as we have seen in the past, it might be contagious.
Sputnik: What is your take on Carlo Cottarelli, Italy’s pick for a caretaker prime minister?
Sputnik: What do we know about the current stance regarding Five Star and the League regarding the euro, because they dropped their initial ambition that they spoke of, of exiting the euro; they were talking about trying to reform it, what is their position regarding the euro now?
The views and opinions expressed in this article are those of the speaker and do not necessarily reflect those of Sputnik.