January 23, 2019 / 9:15 PM / 4 months ago

Italy's prime minister promises to change Italy in two years

DAVOS, Switzerland (Reuters) - - Six months since entering politics, government and the international arena, Italian Prime Minister Giuseppe Conte took to the stage of the World Economic Forum on Wednesday to talk up his administration’s populist vision.

Italy's Prime Minister Giuseppe Conte speaks to the media during the World Economic Forum (WEF) annual meeting in Davos, Switzerland, January 23, 2019. REUTERS/Arnd Wiegmann

In a flurry of meetings, interviews and a speech, Conte, a Florence law professor, railed against the damage globalization had wrought on the middle classes and noted how disappointed Italians are with the European Union.

He said his government planned a massive upgrade of its physical and digital infrastructure, and played up a newly unveiled income-support program, saying it would help lift 5 million Italians out of poverty.

“Financial stability is very important, but more important is social stability and working...for the needs of the people,” Conte said in an interview.

In a subsequent speech, delivered in English with a smattering of Italian, he said Italy was focused on one thing: the “PEOPLE” (noted in capital letters in a handout of his official speech to the press).

“We are radical, but we are radical because we want to bring power back to where it was supposed to be, according to our Constitution, its people,” said Conte, who was plucked from obscurity to lead the euro zone’s third largest economy.

But by his own admission, Conte’s government — which comprises the anti-establishment 5-Star Movement and far-right League — does not enjoy universal international goodwill.

The 54-year-old prime minister said his administration didn’t “have the trust of the international press”. He also rued that his government had a reputation for inaction, saying: “It’s not true. We are doing thousands of things.”

His more outspoken ministers have battled Brussels over EU budget restraints and have repeatedly denounced French President Emmanuel Macron, accusing him of sucking the wealth out of Africa and promoting an elitist vision of Europe.

Conte has often sought to play the peacemaker, but has struggled to overcome the strident voices of his deputy prime ministers — League leader Matteo Salvini and 5-Star chief Luigi Di Maio.

UPHILL

Reflecting his lower profile, Conte spoke before a thinly populated auditorium at Davos on Wednesday, hours after it was jam-packed for the address of German Chancellor Angela Merkel.

Conte was also not introduced by WEF founder Klaus Schwab, who had earlier chaired the speeches of Merkel and Brazilian President Jair Bolsonaro.

In the corridors of the conference center, one European prime minister quipped that he wouldn’t visit Italy until it “changed its government”.

Italy’s economy is also on an uphill trajectory. The International Monetary Fund recently cut its estimates for Italy’s growth in 2019 to 0.6 percent, compared to the government’s 1 percent target.

And Italy risks overstepping hard-fought agreements with the European Union over deficit targets too, but Conte urged investors to give his government more time to measure the effects of its growth agenda.

“Our reform plan will bloom in the spring,” he said.

“I am convinced that by the end of the year we will have an incredible acceleration of growth and you’ll see that at the end of the year we will surpass, by a large margin, the one percent growth laid out in our budget.”

He also predicted that the spread between Italian and German bond yields, a gauge of market confidence, would rapidly fall from just above 250 basis points at present to some 150 points.

In the interview, Conte added that Europe faced an uncertain future, with many unresolved issues “dragging on”, particularly on immigration where he said the EU was exposing its weakness.

But to young Italians who have emigrated in droves in recent years in search of jobs, he promised a Renaissance back home based on investments in digital enhancements — although he did not give details.

Italy's Prime Minister Giuseppe Conte gestures during the World Economic Forum (WEF) annual meeting in Davos, Switzerland, January 23, 2019. REUTERS/Arnd Wiegmann

It cost Italy 80,000 euros ($91,000) to put someone through university, Conte said. “So a young person who is trained in Italy and then leaves represents a huge economic loss.”

“We are really changing Italy,” he said. “Give me one or two years, and you will find another Italy.”

($1 = 0.8786 euros)

Reporting By Alessandra Galloni; Editing by Crispian Balmer and Mark Bendeich

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