ROME Jan 2 Italy can negotiate a relaxation of
European Union deficit limits if it shows it is serious about
effective reforms to its economy and political system, Matteo
Renzi, the new head of the centre-left Democratic Party said in
an interview on Thursday.
Renzi is not in the government but as head of the biggest
party in Prime Minister Enrico Letta's left-right coalition, he
will have a decisive role to play in shaping the political
agenda and has already called for quicker action on reforms.
"If there's a leadership with a vision, I can't see a
problem with passing the deficit ceiling, although we'd have to
have a battle to change the rules," he told the daily Fatto
Despite its worst recession since World War Two, Italy has
managed to bring its deficit within the EU's limit of 3 percent
of gross domestic product, at the cost of deep public resentment
at the tax hikes and other austerity measures required to meet
Renzi, the 38-year-old mayor of Florence who won a sweeping
victory in his party primary last month to assume leadership of
the centre-left, said the 3 percent deficit ceiling was a mark
of the lack of vision which had pushed Europe into crisis.
"It's obvious you can exceed it; it's an anachronistic limit
which dates back 20 years," he said.
He said Italy had to show it was ready to reform its
constitution, to cut the bloated cost of its political system,
and pass a Jobs Act capable of attracting international
investors along with other reforms.
If it did so, "Europe will applaud, even if you breach the 3
percent. Europe needs a living Italy."
Renzi's comments contrast in tone with the position of
Letta, who has said repeatedly that Italy's budget discipline
had ensured it regained international credibility and lowered
its borrowing costs.
However he "categorically" rejected the euro scepticism of
the anti-establishment 5-Star Movement, whose leader Beppe
Grillo has proposed a referendum on leaving the euro.
"Leaving the euro would have decidedly negative
repercussions for Italians, it would send interest rates
shooting up, it would make it more difficult for companies to
work and it would weaken family purchasing power even more," he
said. "I'm open to a discussion but I disagree with it in