ECB conference: Mario Draghi discusses policy stance

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Mrs Merkel has entered her final week as German Chancellor. Her momentous 16-year stint will come to an end as Germans head to the ballot boxes on Sunday to decide who will take her place. Armin Laschet, who took over from her as leader of the Christian Democratic Union (CDU) earlier this year, has taken a beating in the polls, leaving his opposition number Olaf Scholz of the Social Democratic Party of Germany (SPD) in pole position.

Questions are now being asked about Germany’s future role in the EU.

Mrs Merkel has largely been viewed as having led the EU alongside French President Emmanuel Macron, building something of a legacy between them.

While many have suggested that Mr Macron might look to swoop in and grab the EU with both hands, others claim a post-Merkel Europe may see another major power come into the fold.

Dr Alim Baluch, a professor who specialises in German politics at the University of Bath, claimed Italy, Europe’s third largest economy, may be welcomed as a leading power.

He said an alliance in Europe post-Brexit and post-Merkel was much needed, with many European countries not necessarily wanting a Franco-German strongman duo.

Dr Baluch told “The alliance (Franco-German) will become even more important because of Brexit, and maybe this will get on other countries’ nerves.

“Maybe Germany and France together have to find a third country — Italy has a big economy and a lot of people.

“So, maybe the rest of the EU feels dominated by the Franco-German alliance and that might, going forward, be a problem.”

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He indicated that Germany may be more than happy to welcome a third country into the upper echelons of power, as it has historically shied away from appearing to lead the EU.

He added: “Germany is very happy for France to pretend that they are more influential than they are and to have shrill messages when they bark at smaller countries or the UK.

“France wants to punch above its weight and Germany says, ‘Yes that’s great, go ahead.'”

In recent months, Italy has rekindled its bond with Brussels following three years of the eurosceptic Five Star Movement being in power.

Mario Draghi, who became Italian Prime Minister earlier this year, has worked closely with European Commission President Ursula von der Leyen, Mrs Merkel and Mr Macron in their European pursuits.

In the summer, he championed the EU’s landmark COVID-19 recovery fund and said he was “certain” that, if successful, aspects of it would likely become permanent.

Italy looks tipped to benefit from the recovery fund, it being the largest beneficiary by far after a devastating battle with COVID-19 last year.


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As part of the plan, the Italian government committed 58 reforms and 132 investments over the next five years.

In a press conference alongside Ms von der Leyen at Rome’s film complex Cinecittà, he said: “If this goes through, and it is a great responsibility for Italy … then I am certain that some parts of the effort made by the Commission and European countries will remain structural, because the trust that has been given to us will have been shown to be well placed.”

Italy’s cooperation contrasts sharply with many other European countries, especially those in the north who initially rejected calls for a recovery fund.

Mr Draghi added: “It is a responsibility for us, and a reason for pride, a reason for success, the beginning of a new phase in which Italy will change, growth will rise.

“But it is also an occasion in which what has been done for the first time … in European history can also remain permanent — some parts of this plan.”

He may also find an ally in Mr Scholz, who currently leads the polls five percentage points clear of the ruling CDU/CSU coalition.

Earlier this year, Mr Scholz lauded Mr Draghi as a “true European” with expertise in fiscal policy shortly after he won Italy’s election.

Speaking to reporters ahead of a virtual meeting of eurozone finance ministers, Mr Scholz said: “In Italy, again, a pro-European government has been formed.

“That’s a very, very good sign.

“Mario Draghi stands for a very smart policy, he is very experienced in fiscal policy.

“He is well connected internationally and he is a true European.”

Mr Draghi is also the former head of the European Central Bank (ECB), the bank of the eurozone related in structure to Germany’s Bundesbank, so has a tight connection within the EU.

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