Political future on the line for Renzi as referendum looms

ITALY is set to deal a hammer blow to its government as the latest polls revealed voters will punish Matteo Renzi’s administration in the upcoming referendum. “It’s already difficult to convince people to invest in Europe now; it will become even harder to persuade them to invest in Italy”.

If successful, it will reduce the influence of the Italian upper house (Senate), eliminate some layers of administration and re-allocate some autonomy from regional governments to the state.

They only need to answer “yes” or “no”. However, at least 20% of respondents were undecided, leaving Mr. Renzi’s supporters hope that a “yes” vote could still prevail.

A poster calling for Italians to vote “Yes” and a placard during a “No” rally.

– To strip the second chamber of parliament, the Senate, of most of its powers to block and amend legislation.

Politically, the referendum threatens the survival of the European Union.

Since he would likely remain leader of the large center-left Democratic Party, any coalition would require the support of the 41-year-old, who is widely regarded as a savvy operator without any real rivals.

Five Star Movement, lead by former comedian Beppe Grillo, has been creeping up in the polls.

The last time Italy held political elections, for the European parliament in 2014, 51.7 percent turned out in the regions south of Rome, compared with 66 percent in the north-west, which includes the financial capital Milan.

What’s the worst that could happen? Hofer narrowly lost to Van der Bellen in May’s vote, but the outcome was canceled after an Austrian court ruled there were ballot irregularities.

His party is also pushing against the anti-system 5-Star Movement (M5S), which offers a protest vote against hardship which is seen as being aggravated by years of corruption.

If Renzi is defeated, he is expected to go to President Sergio Mattarella at the Quirinale Palace, a ritual for a prime minister about to resign.

Victory for him will energise the far-right in France and The Netherlands and create more tension in a European Commission struggling to keep the bloc’s values of free movement and equality intact.

Normally, when a country faces economic challenges, its central bank will adjust monetary policy (buy or sell bonds; lift or lower rates), and its government will tinker with fiscal policy (spend less or more).

The narrative has played strongly internationally but less so in Italy, where the merits of the proposed reform itself have been vigorously debated in a contest which has also focused on Renzi’s record and personality. “The referendum match will be decided in the last 48 hours”, the centre-left leader said in a Q and A session session on Facebook on Friday.

“Although not always in a linear, straightforward and clear manner”, he added.

Mr Renzi has staked his political future on the result, initially vowing to resign in the event of a “no” vote.

“He’s also appealed to those Italians overseas who are eligible to vote to also exercise a vote in favour of Yes”.

Meanwhile, on Thursday evening, former Prime Minister Silvio Berlusconi said that backing Renzi’s constitutional changes would put democracy at risk and that voting Yes would mean voting for a dictatorship.