‘No’ wins Italy referendum – Matteo Renzi steps down as prime minister

Italian Prime Minister Matteo Renzi has resigned after suffering a heavy defeat in a referendum over his plan to reform the constitution.

In a late-night news conference, he said he took responsibility for the outcome. He said the No camp must now make clear proposals.

An exit poll for state broadcaster RAI suggests 42-46% voted to back reform, compared with 54-58% voting No.

The first projections based on the official count point to a wider defeat.

Early indications have the Yes vote at 39-43% and the No at 57-61%.

“Good luck to us all,” Mr Renzi told reporters. He said he would tell a Cabinet meeting on Monday afternoon that he was resigning, and then tender his resignation to the Italian president after two-and-a-half years in office.

The president is expected to ask him to stay on at least until parliament passes a budget bill later this month.

Mr Renzi said the reforms he proposed would have cut Italy’s bureaucracy and made the country more competitive.

But the referendum was widely seen as a chance to register discontent with the prime minister.

BBC.com

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What happens now?

Renzi says he will tender his resignation to president Sergio Mattarella on Monday. After that, things get messy.

How messy? Wolfango Piccoli of research firm Teneo Intelligence reckons these are the possible scenarios (click here for a PDF):

The likeliest path is that Italy gets a caretaker government, with finance minister Pier Carlo Padoan considered a front-runner to serve the rest of the term. The next general election is due in 2018, but Renzi’s opponents, which include the center-right, populist far-right, hard left, and other anti-establishment parties, may try to force a snap election in the hopes of gaining power. The sooner the election, the more uncertainty and instability it will entail for Europe’s fourth-largest economy.

Italy is no stranger to political turmoil, of course—it has had 63 governments since the founding of the republic after World War II. Even so, a renewed wave of instability is unwelcome. The Five Star Movement, an upstart populist party that wants to hold a referendum on Italy’s membership of the euro zone (but not the EU itself), is neck and neck with Renzi’s Democrats as the party likely to garner the most votes in the next election.

Complicating matters is a push to reform the country’s electoral laws, intended to award the most popular party bonus seats to ensure more stable government majorities. The rejection of constitutional reforms puts these electoral changes in doubt—perversely, that probably hurts the chances of the populists celebrating Renzi’s defeat gaining power, according to analysts at Manulife.

This makes it far too simplistic to say that what happened in Italy is akin to the Brexit vote in the UK or Donald Trump’s victory in the US. In Rome, the populists agitated for voters to stick with the status quo, and the result could make it harder for them to seize power down the line. The target of their ire was 41-year-old Renzi, Italy’s youngest-ever prime minister, who they painted as part of an ossified, ineffectual establishment. There are many steps that would need to happen before anything like Brexit—or “Quitaly,” if you will—is a remote possibility in Italy.

What’s clear, however, is that a founding member of the EU and euro zone has been shaken, and the reverberations are unlikely to break it out of its economic stupor.

qz.com