The Eurozone is not ready to face another economic crisis, French Finance Minister Bruno Le Maire said in an interview for the daily Le Parisien. He said though that there was no risk of contagion from Italy’s budgetary crisis in the European Union. The EU Commission dismissed Italy’s draft 2019 budget last week for breaching EU rules on public spending and asked Rome to submit a new draft within three weeks.
“We do not see any contagion in Europe. The European Commission has reached out to Italy, I hope Italy will seize this hand,” he said in an interview. “But is the Eurozone sufficiently armed to face a new economic or financial crisis? My answer is no. It is urgent to do what we have proposed to our partners in order to have a solid banking union and a Eurozone investment budget.” Eurozone officials say that the EU-Italy standoff is unprecedented and very likely to delay the reform process. Mr.
Le Maire also added that French financial institutions with branches in Italy had issued corporate and household loans worth 280 billion euros. “This sum is manageable but substantial,” he said. Pierre Moscovici, the EU Commissioner for Economic and Financial Affairs, earlier said that the Commission would take a soft line towards Rome over the budget crisis. He said he did not want to risk the EU being portrayed as “an illegitimate body: the Brussels bureaucracy bunker against the Italian people”.