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2 Mar, 2013 19:31

‘Italy may abandon euro if debt not renegotiated’ - politics kingmaker Grillo

‘Italy may abandon euro if debt not renegotiated’ - politics kingmaker Grillo

The economic crisis may see Italy abandoning euro and returning to lira, says comedian-turned-politician, Beppe Grillo, who’s anti-establishment Five Star Movement became a major power in the country’s politics after the last week’s general election.

In his interview with German Focus magazine, Grillo urged for the renegotiation of Italy’s €2-trillion debt, which is the second highest in the euro zone after Greece, at 127 per cent of gross domestic product (GDP).

“Right now we are being crushed, not by the euro, but by our debt. When the interest payments reach €100 billion a year, we’re dead. There’s no alternative,” the 64-year-old said.

According to the Five Star Movement leader’s forecast, the Italian political system has "only six months" left before it collapses and the state will no longer be able "to pay pensions and public sector salaries".

If there’ll be no changes to the debt obligations, Grillo believes, the option for his country would be to leave the euro and return to it's former national currency, the lira.

"If I've bought shares in a company that goes bankrupt, then that's my bad luck. I took a risk, and lost,"
he explained, drawing a comparison with the private market. “If the conditions remain the same, Italy would leave the euro and return to the lira.”

The Five Star Movement has attracted the sympathy of nearly a quarter of the many austerity-weary voters to win 109 seats in the Chamber of Deputies and 54 seats in the Senate in the general election on February 24-25. This has created a political deadlock.

Neither Pier Luigi Bersani‘s center-Left Democratic Party nor the center-Right coalition led by Silvio Berlusconi currently have sufficient majority in in both chambers to form a government. The conditions of the parliament’s newcomers is unacceptable to the established parties preventing the formation of a coalition government.

"If Bersani's PD and Berlusconi's PDL suggest an immediate change in the electoral law, cancellation of election expenses reimbursement, and a maximum of two terms for any deputy – we would of course support such a government immediately," Grillo said. "But they won't do that. They are just bluffing to win time."

"If we get into parliament we would bring the old system down, not because we would enjoy doing so but because the system is rotten," he added.

The Five Star Movement has everything it takes to become a huge headache for the European leaders, who have urged Italy to stay on the economic course laid out by Mario Monti ‘s outgoing government.

"Italy, as a major European economy, has a great responsibility,”
Philipp Roesler, Germany's Economy Minister, was quoted in the same edition of Focus. “There is no alternative to the policy of structural reforms... I'm confident that those responsible in Italy recognize the importance of stability.”

Beppe Grillo was a popular comedian on Italian television in 80s, but he disappeared from the screen in the 90s, with many suggesting that his harsh satire was too much to handle for Italian politicians.

After that he mainly performed in theatres and staged a series of mass rallies, including the 2007 V-Day celebrations, which gathered around 2 million people, protesting against the criminal activities of the Italian political elite.   

The Five Star Movement was started by Grillo in 2010 and has made a splash at local elections, receiving the third highest number of votes overall and winning the mayoral election for Parma before the latest success in the general election.

For the Italian government to be able to pass legislation, it must have a majority both in the Chamber, and the Senate, and to achieve this majority coalitions are often formed.