Italy faces political, economic uncertainty after referendum

Italian voters dealt Premier Matteo Renzi a resounding rebuke early Monday by rejecting his proposed constitutional reforms, plunging Europe's fourth-largest economy into political and economic uncertainty.

In terms of formalities, the next steps are quite straightforward: Renzi will tender his resignation to Italian President Sergio Mattarella on Monday.

Coming after Brexit and Donald Trump's United States election victory, Mr Renzi's defeat is being seen as another victory for the anti-establishment backlash sweeping much of Europe and America.

"I think we have to take this with a dose of serenity", but added: "Italy urgently needs a government that is ready to act".

Some political groups are calling for an early election to fill the prime minister's office. Renzi had first envisioned his Democrats snatching the bonus, but now opponents of the 5-Star Movement worry the populist forces could sweep to power.

The palace in Rome confirmed that Mr Renzi had told the president it was not possible for him to continue in his post following the defeat on Sunday of a constitutional referendum championed by Mr Renzi.

5-Star campaigned hard for the "No" vote which prevailed in Sunday's referendum by a far bigger margin than polls predicted.

Following Donald Trump's election as US president, and the Brexit vote in June, the poll is the latest in which victory by anti-establishment forces has sent economic and political shock waves internationally.

Founder Beppe Grillo has called for quick elections. The 5-Stars are the chief rivals of Renzi's Democrats and are anxious to achieve national power for the first time.

Germany's Wolfgang Schaeuble, the eurozone's most powerful finance minister, also downplayed the fallout of the Italian vote, but urged Rome to move swiftly to avoid further uncertainty.

"Arrogance lost, from which we'll learn many things in forming our team for government and our platform", Di Maio said.

"The man alone at the command doesn't exist anymore, but the citizens who govern the institutions do", Di Maio told a news conference minutes after Renzi conceded. Consequently, the people have never really had a chance to vote - or not - for Renzi. While a more improbable situation, the president may ask him to remain in his role until a budget bill has been approved on December 23. Government borrowing, depending on which figures you look at, is one of the largest in the eurozone.

Furthermore, Italy's Constitutional Court is due to deliver a verdict on Mr Renzi's electoral law shortly.

Italian Prime Minister Matteo Renzi has resigned following the country's decisive "no" vote on Sunday by nearly 60-40 in a landmark constitutional referendum.

The more likely scenario is that Mattarella will order the formation of a caretaker government led by a member of Renzi's cabinet or a technocrat (someone with appropriate experience in government but not a politician). He urged elections straightaway. Some read the referendum as an outlet for growing anti-establishment, populist sentiment in Europe.

"Renzi is punished from north to south for his decision to personalise the constitution", wrote the left-leaning Il Fatto Quotidiano.

Lega leader Matteo Salvini linked the result to his party, framing it as a right-wing resurgence in keeping with the rise of Donald Trump and Marine Le Pen - while also taking the opportunity to praise Vladimir Putin.

Once backing Renzi on the need for the reforms, Berlusconi came out against the referendum, even though executives in his media empire backed the reforms as being good for the economy. The reforms included steam-lining the Senate and giving the central government more powers at the cost of the regions. D'Alema campaigned heavily against the reforms and celebrated their defeat.

  • Jon Douglas