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ANSA-INTERVIEW/ Benassi, ‘time for the gas price cap, Italy is confident’
The Permanent Representative to the EU: ‘the ECB anti-spread shield is a good thing’ (by Michele Esposito)

Courtesy automated translation –  the Italian version is the official one.

(ANSA) – BRUSSELS, JULY 14 – The price cap is needed now more than ever and Italy is confident that the EU will eventually reach the same conclusion. Ambassador Piero Benassi, Italy’s Permanent Representative in the EU, in an interview with ANSA takes stock of one of the most discussed measures in these weeks of ‘energy war’ between Europe and Russia.

But the Union is also heading for a hot autumn on other dossiers, from enlargement to the new economic governance and the reform of the Treaties. A point on which Italy’s position is clear: ‘We sit at the table without fear,’ he explains. On 20 July the Commission will present its emergency gas plan for the winter. “The plan will focus on measures for a coordinated reduction in gas consumption and on intensifying efforts to diversify supplies. However, we think that these measures should be accompanied by a cap on gas prices as soon as possible. The current contingency does not alleviate the need to introduce a price cap: while supplies to the EU are shrinking, putting our energy systems under pressure, gas revenues for Russia remain stable or increase as a result of higher prices, particularly on the European market,’ Benassi emphasises.

According to the ambassador, “a cap on the price of gas imports, in addition to calming energy prices in Europe, would discourage manipulative behaviour by Russia. All elements on which Rome sees glimmers of convergence. “The Commission, at the encouragement of Italy and other countries, is studying a proposal. Some technical aspects still remain to be defined and some reluctant member states will have to be convinced, but we are confident that we can achieve the result’, is the diplomat’s prediction. In the coming months, the dossier of treaty reform could also end up on the table of the meetings of the ambassadors of the 27. “It is necessary to sit around a table and look at the content and the objectives of the proposals of the Conference on the Future of the EU and not at the instruments and procedures, otherwise I fear that we would not be doing justice to the very spirit of the Conference,” Benassi stressed.

And Rome’s position is clear. “In a government document of February 2020, later updated in July 2021, Italy indicated some of the priority issues. Among these – without pre-established views – is the simplification of the decision-making process, with the possibility of a shift to qualified majority voting in areas such as social security, social protection and taxation and in some areas of the Common Foreign and Security Policy,” the Italian ambassador noted. Recalling that “in his speech to the European Parliament on 3 May, President Draghi confirmed Italy’s willingness to play a leading role, showing itself receptive to the hypothesis of revising the Treaties”.

The Ukrainian war has also rekindled the spotlight on EU enlargement. Not only in Kiev but also in the Western Balkans, where the stalemate over North Macedonia risks separating the Skopje accession dossier from the Albanian one. “I would not speak of a risk of them being separated. Each candidate negotiates its entry on the basis of its progress in adopting the acquis communautaire and there would be nothing strange if Albania and North Macedonia proceeded independently,’ Benassi notes. ‘We,’ he emphasises, ‘hope that the two paths will proceed quickly and we hope that we will be able to open negotiations as soon as possible. The enlargement of the EU to the Balkans is, in our opinion, unmissable and is a strategic investment’.

The autumn of 2022 will be the setting for the delicate review of economic governance. The Commission has repeatedly called for cautious accounting, and among the hawks in the North, there is discontent about the anti-spread shield announced by the ECB. “The normalisation of a particularly expansive monetary policy, such as to support the economy during the Covid crisis, is in fact inevitable as it is necessary to keep market price expectations anchored.

On the other hand, as recognised by Bank of Italy Governor Visco himself, the considerable widening of yield differentials between the government bonds of member countries perceived as more vulnerable and German ones is a sign of a serious risk of market fragmentation, where such differentials do not appear to be justified by an effective assessment of economic fundamentals, especially in the case of countries such as Italy,” is the Permanent Representative’s premise. “And this is the main reason,’ he points out, ‘why we must instead look favourably on the ECB’s announcement to resort, where necessary and to the extent necessary, to all the instruments in its possession, even creating new ones, such as the anti-spread shield’. Of course, monetary policy alone cannot suffice.

“It will be essential to continue strengthening the resilience of European economies with appropriate structural reforms, remembering that the NRPs represent an extraordinary potential for development if fully implemented,” Benassi concludes.