Bank of Italy Governor calls for review of Stability Pact

According to Visco, the state will have to “guide” post-pandemic recovery as a “facilitator” but will not have to “replace the productive world”. [PA-EFE/MASSIMO PERCOSSI]

It is necessary to review the European Union’s Stability Pact before the end of its suspension, and to find a “harmonious and long-term vision between countries”, even if it is necessary “to be very attentive to the risks of inflation”, Bank of Italy’s Governor, Ignazio Visco, said in a speech on Sunday.

According to Visco, the state will have to guide post-pandemic recovery as a facilitator but will not have to “replace the productive world”.

“The recovery will be complicated”, because in the coming months when in Italy the ban on layoffs is lifted, “the change will be very strong” and there will be “an extensive restructuring”, he said.

Last year has shown that Italy needs an evolved system of social safety nets, which are now “too fragmented”, Visco said, pointing to the many risks if recovery were to be left only to the market. 

Italian Economic Development Minister Giancarlo Giorgetti explained on Sunday that there is a need for reform with regards to the protection of workers, adding that the freeze on layoffs has been and must remain “an exceptional measure”. 

The government has prepared several tools to support companies in the transition, which must always be accompanied by the “presence of a private partner” because public interventions will be temporary and dropped once “the turbulence has passed”, he added. (Daniele Lettig | EURACTIV.it)

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