Regret of Italian PM As Referendum Defeat Looms

Italian Prime Minister Matteo Renzi says that he regrets making the constitutional referendum too personal and about his government as polls show he may be heading for defeat.

On Sunday, Italian voters will go to the polls on Italy’s constitutional referendum which Prime Minister Matteo Renzi has staked his political career on winning. The referendum will ask voters whether or not they agree with reforms that would centralise the government and remove much of the power of the senate, reports Kurier.

Speaking at an election forum with the chief editor of the daily newspaper La Repubblica, Prime Minister Mario Calabresi said: “I have been focusing mainly on the political impact of the referendum on my government.” He reiterated what he considers the importance of the vote for the future of democracy in Italy, but also noted the impact it will have if he is defeated by “no” voters.

“On Sunday, it is not Matteo Renzi being voted for. The referendum will have an impact. A government is less important than a reform that could change Italy for the next 50 years,” he said and added, “Whether ‘Yes’, or ‘No’ wins, democracy will certainly win”.

As latest polls have shown, support for Mr. Renzi has deteriorated with the public looking for the result to be a defeat for the Italian leader. Some suggest that the loss, which would lead to his resignation, could spark a crisis within the European Union (EU) as many see a “No” vote in the referendum as a rejection of the EU itself and a path for the populist Five Star Movement (M5S) into power.

The Eurosceptic M5S has already achieved electoral success this year with the election of Virginia Raggi as mayor of Rome and Chiara Appendino elected mayor of Turin.  Polls even show the movement, which grew out of a political blog authored by co-founder and leader Beppe Grillo, is close to becoming the most popular political force in the country and capable of forming a centre-right coalition government if new elections were to occur.

Italy, EMG poll:

PD-S&D: 31%
M5S-EFDD: 30% ↓
LN-ENF: 13%
FI-EPP: 11%
FdI-NI: 4%
NCD/UDC-EPP: 4% ↑
SI-LEFT: 4% ↑#Italy #Sondaggio

— Europe Elects (@EuropeElects) November 29, 2016

The fate of the Eurozone could also come into play if Renzi loses on Sunday as the Italian banking crisis could escalate in the ensuing instability. Italy’s Banco Monte dei Paschi di Siena (MPS) has over $55 billion (£44 billion) in bad debt and is facing a collapse that could send shockwaves throughout the Italian economy and the broader European economy.

Due to EU regulations, the Italian government cannot bail the bank out and potential instability in the wake of the referendum could cause panic selling by investors and wipe out the little capital that is holding the bank together.