April 18, 2019 / 10:49 AM / 4 months ago

Italy's League presents anti-euro candidates at EU elections

* Doubt about League’s commitment to euro resurfacing

* Leading candidate says priority to change EU fiscal rules

* League’s support now above 30 pct, tops in polls

By Gavin Jones

ROME, April 18 (Reuters) - Italy’s right-wing League has presented prominent anti-euro campaigners among its candidates for next month’s European Parliament elections, reviving doubt about the ruling party’s commitment to the single currency.

Antonio Rinaldi, who teaches economics at Rome’s Link Campus University and is a frequent guest on television talk shows, has campaigned for years for Italy to “take back the keys to our own house” by leaving the euro zone.

Francesca Donato, another candidate on the party’s slate presented on Wednesday, is president of Italy’s Eurexit Association, whose goal declared on its website is “to leave the euro to relaunch our economy and re-establish democracy.”

Anti-euro campaigners say quitting the euro would allow Italy to revive its stagnant economy by spending more and devaluing its currency, helping exports. Others warn the move would lead to a flight of capital, higher borrowing costs and inflation, reducing the value of Italians’ savings.

When Matteo Salvini became leader of what was then called the Northern League in 2013, it was reeling from corruption scandals and had only about 4 percent of the vote. He galvanised support with a fiercely anti-euro message and ran at the last European elections in 2014 under the slogan: “No Euro”.

The early months of the current government of the League and the anti-establishment 5-Star Movement, which took office last June, were dogged by market fears that the coalition might engineer an “Italexit”, which pushed up Italian borrowing costs.

Those concerns have receded thanks to assurances from Economy Minister Giovanni Tria that Italy is fully committed to the euro, and Salvini said in December he wanted to “change the rules of the EU from the inside.”

LEAGUE LEADING THE POLLS

The League is now Italy’s most popular party with support above 30 percent, according to opinion polls, but critics remain suspicious about its intentions with the single currency.

“Its position on the euro is essentially ambiguous,” said Riccardo Puglisi, a pro-euro economics professor at Pavia University.

“On the one hand its policy agenda with 5-Star rules out an Italexit, but its economics spokesman Claudio Borghi is openly hostile to the euro, and now Salvini is running candidates who are possibly even more eurosceptic.”

Donato told Reuters that her job in Brussels would not be to work for a euro exit but to fight for changes to EU fiscal rules and to the mandate of the European Central Bank.

She said the ECB’s primary goal should be full employment, while the EU should allow budget deficits of up to 6 percent of gross domestic product and be more severe on countries like Germany which run excessive trade surpluses.

Italy clashed with Brussels last autumn over its expansionary budget plans and many economists see its huge and rising public debt, which stands at 132 percent of gross domestic product, as a simmering threat to EU monetary union.

“The euro doesn’t work and cannot continue like this, but we want to make an attempt to reform it and make it sustainable,” Donato said. “If we fail, then it will be easier to explain to Italians that the only thing to do is to leave.” (Editing by Mark Heinrich)

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