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EU reels from Italy vote as Renzi resigns

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EU reels from Italy vote as Renzi resigns

Matteo Renzi - Photo EU Council

(ROME) - Italy was left facing economic and political uncertainty Monday as prime minister Matteo Renzi resigned after voters rejected his plans to reform the constitution.

On a high turn-out, 60% of voters rejected the constitutional reforms which Mr Renzihad said were needed to revive the country’s economy by making it easier to govern. Instead many voters seized on the referendum as a chance to register discontent with the current government and the political establishment.

The Italian president now has to decide how to take the democratic process forward, including whether he appoints a new PM or goes to hold new elections.

An election would add to the turmoil facing Europe at the current time, as far-right movements seize on the opportunity of economic troubles and voter dissatisfaction as their chance for power.

The far-right looks likely to profit from Mr Renzi's resignation, as it does in other countries holding key elections next year. EU leaders will face elections in France, Germany and the Netherlands, and the Italian vote will make them fear another chance for right-wing, anti-immigrant politicians to voice anti-EU sentiment.

Arriving in Brussels for a meeting of Eurozone finance ministers today, Eurogroup head Jeroen Dijsselbloem played down the consequences of the referendum result, saying Italy's economic problems were little different to what they were yesterday.

He said the vote was about reform of the constitution, and the political consequences for the government have yet to be seen. It is up to the Italian president to take further decisions on the democratic process, he said.

Mr Dijsselbloem added that Italy was a strong economy, one of the largest economies in the eurozone, a country with strong institutions, and the next government would have to deal with the economic situation in Italy.

However, he admitted that voters were "on the move" in Europe and "critical of the situation". "We're coming out of a deep crisis", he said, "it has taken a long time, it has affected the lives of many, and people are concerned about that, and will express their concern at election time."

He added that politicians needed to show perspective, show that "is a way forward, which is economic and socially viable."

EU leaders will take some comfort from the fact that Austria's far-right candidate Norbert Hofer lost the presidential election yesterday.

While the post is largely ceremonial, the election of Mr Hofer would have been broadly seen as another signal of the rise of anti-establishment, anti-immigrant populism throughout Europe.

The winner and new president Alexander Van der Bellen said Austrian voters had voted for a "pro-European" Austria based on "freedom, equality and solidarity".

Eurogroup, 05/12/2016

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