Passos Coelho, former Portuguese prime minister, about Italy: “This crisis may be more serious than the others”

“No one can say that just because Italy is used to dealing with political crisis, that this one will not become more serious than the previous ones”, warned Pedro Passos Coelho, the leader of the Portuguese Social Democratic Party (PSD), this Monday, on the first ECO Talks – an event organized by ECO, in Lisbon, in which guest speakers discuss current events concerning politics, finances and economy.

This is the former Portuguese prime minister’s reactions to the outcome of the Italian referendum and the resignation of Matteo Renzi. Passos Coelho argued the political crisis could have been avoided if Renzi had not “turned this referendum in some sort of plebiscite to his endurance”.

The risks are worse, Passos Coelho explained, because of the fragility of the Italian banking system. “The Italian government has been, for a year, blabbering about the issues in their banks”, he pointed out. “The situation banks are facing is complicated”, he stressed, recalling that Italy “is not growing and has the second largest public debt in Europe, after Greece”.

Even so, the social-democrats’ leader gave credit to the constitutional reform Renzi presented, since it allowed to “simplify the decision-making process” and it would make it easier to obtain parliamentary majorities. “It is in times of hardship that the government needs to be stronger”, Passos Coelho argued. “But the Italian people are not available to take that leap”, he concluded, acknowledging, however, that the scope of the powers the winning party would have would likely “cause some mistrust”.

Matteo Renzi announced his resignation this Sunday, due to the result of the Referendum – “No” on changing the Constitution.