Bloomberg News

Schaeuble Says Italy Must Reform, Not Rely on ECB for Easy Way

December 06, 2011

Dec. 6 (Bloomberg) -- German Finance Minister Wolfgang Schaeuble said Italy must overhaul its economy and not rely on the European Central Bank to offer a “comfortable way” out of the sovereign-debt crisis.

The ECB started buying Italian bonds on Aug. 8 in a bid to stem soaring borrowing costs for the euro region’s second most- indebted economy. Critics such as former Italian Prime Minister Silvio Berlusconi have urged the ECB to step up the purchases to end Europe’s debt ordeal, an approach opposed by Germany.

“If you want to trip up Mario Monti now, all you have to do is offer Italy a comfortable way,” Schaeuble said today at a conference in Vienna. Italy “won’t do” reforms then, he said.

New Italian Prime Minister Mario Monti’s Cabinet approved a 30 billion-euro ($40 billion) austerity and growth plan on Dec. 4 to meet the nation’s goal of a balanced budget in 2013. The yield on Italy’s 10-year bond has since declined 85 basis points to 5.82 percent, after having surged last month beyond the 7 percent threshold that prompted Greece, Ireland and Portugal to seek bailouts.

“If you’ve lived beyond your means for years, there’s no way around an adaptive crisis,” Schaeuble said. “It’s not possible to evade adaptive processes via the printing press,” he said, referring to ECB bond purchases.

--Editors: Jeffrey Donovan, Simone Meier

To contact the reporter on this story: Lorenzo Totaro in Rome at

To contact the editors responsible for this story: Craig Stirling at

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