Italy?s prime minister says rest of Europe needs to step it up in debt crisis

No European nation is strong enough to ride out the continent's debt crisis alone, Italy's new premier insisted Saturday, urging fellow EU members to develop a common growth policy.

Premier Mario Monti, leader of the euro zone's third-largest economy, is an economist who was appointed in November with a mandate to pull Italy back from the brink of financial disaster.

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?Italy, in order to develop economically and socially, needs Europe, and Europe to be stronger needs Italy,? Mr. Monti said in a speech in the northern city of Reggio Emilia at a ceremony honouring the Italian flag.

?No European country is so strong that it can go forward alone in facing the great global economies,? he added. ?Europe needs to put into action common and co-ordinated growth policies on financial stability.?

With Italy making what he called a ?decisive contribution? to euro-zone stability, ?now it's the time for everyone to do their homework. No one can think they can do less than the others. Europe will overcome the crisis only with the determined and united action of all members,? said Mr. Monti, a former EU commissioner.

Mr. Monti didn't single out any country, but some critics have felt that Germany has been putting its own economic policy ahead of EU-wide interests. Mr. Monti will meet with German Chancellor Angela Merkel in Berlin on Wednesday and at a major European summit in Brussels at the end of the month.

EU leaders at that summit will be wrestling with a worsening economic outlook, as more European nations tip over into recession, skepticism keeps rising over many EU countries' bonds and the survival of the euro remains in doubt.

?The eurozone must continue to represent an anchor and a secure reference point in all its geographic extensions,? Mr. Monti said.

Mr. Monti has successfully prodded Italy's often slow-moving parliament into approving quick spending cuts, new and higher taxes and reforms to the long-generous pension system that will see Italians working longer and retiring later.

He singled out two factors in Italy's favour: the fact that many of its families and business ?are among the least indebted among industrialized nations.? But the premier tried to rally Italians to combat two chronically stubborn problems: corruption and widespread tax evasion by companies and citizens alike.

Foreign investors are frequently discouraged from operating in Italy, where bureaucrats and politicians are often involved in corruption when it comes to securing permits, contracts or funding.

Mr. Monti's next priority is spurring growth in Italy, where the economy is stagnant, women have one of the EU's lowest rates of employment and youth joblessness rates run 30 per cent nationally and much higher in the underdeveloped south.

But unions have vowed strikes and rallies to protest the government's plan to overhaul labour laws protecting workers, including abolishing a provision that makes it very difficult to fire workers.

Lawmakers, with an eye on 2013 elections, may also be nervous about demanding their voters make financial sacrifices.

Source: http://feedproxy.google.com/~r/TheGlobeAndMail-International/~3/TRgC87OY94U/

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