This year – initially meant to be the UK's
final au revoir to EU membership – was always going to
be awkward for the Commission.
The trading bloc dealt with Britain's extension, yet now
faces the premiership of Conservative leader, Boris Johnson,
fresh from years of blasting the continent in an attempt to
present himself favourably to eurosceptic, Conservative
Elsewhere, things have grown less and less comfortable amid
the standoff between the EU and Switzerland. As the bloc
becomes ever more protectionist to preserve the integrity of
the internal market, Switzerland has lost its stock trading
equivalence status, a third country perk enjoyed by further
afield countries such as Japan and Australia. Neither the Swiss
nor the EU have yet backed down as IFLR goes to press, and it
looks as if it will be a while before a new agreement is
ratified between the two that can satisfy each side.
Brexit fatigue, along with electing fresh faces to the new
European Parliament, has largely kept Brussels busy –
meaning most haven't had time to fret over Italy's ever more
agitating tactics. It would be an understatement to say that
the Italian government, a coalition between nationalists Lega
and the populist Five Star Movement, is eurosceptic. Neither
parties trust Brussels, and both largely blame the euro for
Italy's financial troubles. Enter the mini-BOT.
The mini-BOT stands for a small denomination, Mini Bill of
Treasury, and can be issued by governments (in this case,
Italy) to act as a domestic currency. It can settle government
debts and pay taxes, among other things.
Originally touted by Greek economist and former finance
minister Yaris Varoufakis, it was initially viewed as a way of
hoisting Italy's maritime neighbour out of its seemingly
everlasting financial woes.
It acts as a parallel currency and would be circulated
purely domestically – unlike the euro – with
the intention of reflecting the Italian economy better than the
euro does in its current state. Italian politicians feel that
at present the euro is tied too closely to Germany, which makes
it overvalued and detrimental to Italy as a result.
Italy is one of many states that have struggled with the
Other Mediterranean countries such as Portugal and Spain
have also had their problems.
Should Italy's government go ahead and introduce mini-BOTs
into the domestic economy, it raises the potential of other
countries doing the same in an attempt to separate themselves
from the consistently predicted economic downturn around the
The big question is how the European Commission will
approach this. Broadly speaking, the motives of Brexit are
sovereignty-related. The same sentiments are felt by the
populist and right wing parties that have flourished all over
the continent, even in traditionally European economies such as
that of France, the Netherlands and Germany. Should they
respond softly, they risk undermining the European project, and
should they come in hardline, they could set off wildfires that
risk dissolving the europhile boost that has both contributed
to, and followed, the turmoil of Brexit. Watch this space.