Italy, under fierce pressure from financial markets and European peers, has agreed to have the IMF and the EU monitor its progress with long delayed reforms of pensions, labor markets and privatization, senior EU sources said on Friday.
Italian Prime Minister Silvio Berlusconi agreed to the step in late-night talks with eurozone leaders and US President Barack Obama on the sidelines of a G20 summit in Cannes, France.
The Italian move came after Greece stepped back from a proposed referendum that could have triggered its exit from the euro area and agreed to seek national consensus in support of a 130 billion euro (US$178 billion) new bailout program.
“We need to make sure there is credibility with Italy’s targets — that it is going to meet them. We decided to have the IMF involved on the monitoring, using their own methodology, and the Italians say they can live with that,” one EU source said.
“Italy has no problem with surveillance at all, even with the IMF being involved,” he said, adding that the European Commission and the IMF would each report separately on how Italy was meeting its targets.
The leaders of France, Germany, Italy, Spain, the European Central Bank, the IMF and EU institutions also discussed with Obama ways of ramping up the IMF’s warchest to help prevent contagion from the eurozone’s debt crisis plunging the world back into recession.
The concession by Berlusconi was an attempt to shore up his country’s perilous position on bond markets, where its borrowing costs soared well above 6 percent this week, raising doubts about its long-term ability to cope with a debt pile of 120 percent of gross domestic product.
An official Italian source denied that Italy was being singled out for special surveillance and said the whole eurozone would be under closer monitoring. However, he confirmed that Rome was willing to request IMF advice on implementing the commitments it gave EU leaders on specific reforms on Oct. 27.
The EU source said a precautionary credit line was not seen as a credible option for Italy, where one of the main problems has been market confidence.
Analysts are eyeing Italy as a test case for the anti-crisis package agreed in Brussels last week.
“Italy holds the key to the euro zone debt crisis,” BNP Paribas analyst Luigi Speranza wrote in a research note late on Thursday.
“Developments in Italy are a crucial test for the credibility of the anti-crisis framework set up by the EU,” he wrote.
Concern is growing that Italy, the euro area’s No. 3 economy and biggest government bond market, could go the way of Greece and require a bailout without rapid action.
Berlusconi has repeatedly promised to make deep reforms, balance the budget in 2013 and trim the public debt, but there are doubts about his commitment.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last