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Over the past 8 years in the time of the crisis in the euro zone, Italy has never lost access to markets, Regling told CNBC during the annual meeting of the International Monetary Fund (IMF) and the World Bank in Indonesia.
“I think it is not entirely fair to compare Italy with Greece, if we take its most difficult phase,” said the head of the ESM, noting that the situation in Italy is quite better.
"Since the deficit of [the Italian budget] was relatively small, Italy has a surplus in its account, we are aware that most of government debt of Italy is backed by the residents, because there are some money in the private sector are very large," he said.
The plans of the Italian coalition government to enhance spending of the private sector raised concerns among investors.
Last week, Italy announced the final budget figures for the coming years. The government confirmed the target budget deficit at 2.4% of GDP in the next year, which is more that twice as larges as than the forecast of the government before, and set it at 2.1% in 2020 and 1.8% in 2021.
The government also set the target ratio of debt to GDP at 130.9% in 2018, 130% in 2019, 128.1% in 2020 and 126.7% in 2021.
The plan caused criticism from the European Commission and provoked a sharp increase in the yield of Italian government bonds.
“There are concerns about budget figures,” said Regling. “We aren't informed of the particulars. They will be presented to the EC only later. They are tasked to check the basic data that are still unknown to us.”
In response to the question of whether ESM is ready to provide financial assistance to the country in case of a debt crisis, the ESM Director called this question premature, but indicated that all Member States have access to assistance programs.
“I would like to see detailed figures when we obtain the details in the next week,” he added. “I told earlier that the country has some power, and I don't think we should run ahead.”
source: cnbc.com
“I think it is not entirely fair to compare Italy with Greece, if we take its most difficult phase,” said the head of the ESM, noting that the situation in Italy is quite better.
"Since the deficit of [the Italian budget] was relatively small, Italy has a surplus in its account, we are aware that most of government debt of Italy is backed by the residents, because there are some money in the private sector are very large," he said.
The plans of the Italian coalition government to enhance spending of the private sector raised concerns among investors.
Last week, Italy announced the final budget figures for the coming years. The government confirmed the target budget deficit at 2.4% of GDP in the next year, which is more that twice as larges as than the forecast of the government before, and set it at 2.1% in 2020 and 1.8% in 2021.
The government also set the target ratio of debt to GDP at 130.9% in 2018, 130% in 2019, 128.1% in 2020 and 126.7% in 2021.
The plan caused criticism from the European Commission and provoked a sharp increase in the yield of Italian government bonds.
“There are concerns about budget figures,” said Regling. “We aren't informed of the particulars. They will be presented to the EC only later. They are tasked to check the basic data that are still unknown to us.”
In response to the question of whether ESM is ready to provide financial assistance to the country in case of a debt crisis, the ESM Director called this question premature, but indicated that all Member States have access to assistance programs.
“I would like to see detailed figures when we obtain the details in the next week,” he added. “I told earlier that the country has some power, and I don't think we should run ahead.”
source: cnbc.com
