No, but Berlusconi may be confusing the matter. Italy’s economy is relatively vibrant unlike that of Greece. However, Silvio Berlusconi has wasted valuable opportunities instead clinging to the Prime Minister’s office in Rome, even after he announced his resignation. Greece’s sovereign debt burden now is much heavier than that of Italy, and likely to persist for considerably longer. Italy now has a debt to GDP ratio of 120%, which is what Greece hopes to achieve by 2020. Italy’s problem is also tax evasion as in Greece, but the smaller to mid size businesses that are Italy’s economic core continue to be relatively productive, even as there are new competitors in the developing and Asian economies. Leaving the Euro may be an option for both to enhance competitiveness and drive down the value of its sovereign debt burden, but it is considerably less likely and imperative for Italy as a road toward fiscal and economic health. MID-AGE CRISIS? The greatest difference is in political leadership. Italy only a decade earlier had the reputation for serial governments – more changes than a businessman on a trip would use socks. Silvio Berlusconi (Top PHOTO -He is without glass in hand), delivered tenure, but it has now become apparent to most, and especially those who buy and sell sovereign debt that this was in service to personal ego rather than the state and its people. The scandals are a distraction and only the tip of an iceberg of a personality consumed by a couple of decades of mid-age crisis. (READ – Italian Prime Minister BERLUSCONI Claims Doing 8” - diplomaticallyincorrect.org/films/blog_post/italian-prime-minister-berlusconi-claims-doing-8-of-them/35237 George Papandreou (Bottom PHOTO) the outgoing Prime Minister of Greece has been looking to maintain a steady course, (even considering his on and off call for a “referendum”). Silvio Berlusconi has been doing everything to hold onto office to point that even after he announced his resignation, many are not certain whether to believe him. Berlusconi has still not announced the timing for the resignation. His ambiguity/obfuscation on his resignation timetable have raised further cynicism and uncertainty. Italy lacks serious and committed leadership during the crucial moments that can have longer lasting effect, and worse, most financial professionals and speculators recognize it and are acting accordingly on Italian sovereign debt. In a certain way, Berlusconi has managed to contaminate the Eurozone prematurely with his own middle age crisis. SIZE DOES MATTER? There is another critical difference between Greece and Italy – Italy is a much larger economy with also though much larger sovereign debt outstanding – in excess of $2Trillion. This is perhaps more than the EFSF (European bailout fund) could manage to deal with. Size is not an advantage here, and especially when Spain and even France could be on the horizon of tumbling sovereign debt. (Spain and France probably also do not have as competitive economic/production position as Italy). The Italian problem and Berlusconi’s middle age crisis have thus become even more a Eurozone wide problem than Greece. Berlusconi’s departure will be welcome to most. However, it comes late, very late – after so many effective warnings from financial markets and rating agencies. Unfortunately though in only focusing on his own tumble, Berlusconi is now dragging down Italy and perhaps the rest of Europe. As Berlusconi hits the ground, the focus will quickly focus on who is next. The EFSF and last week’s G-20 did produce some hope that the Eurozone can step away from the brink. However, it is now about the small details of the proposed solutions/salvation and the growing number of economies and size on the brink. The bubbly optimism has worn away rapidly, and only the hangover is lurking. (Read – “LIKE FLAT CHAMPAGNE, AFTER G-20” - diplomaticallyincorrect.org/films/blog_post/like-flat-champagne-after-g-20-in-france-by-ambassador-mo/39983 ). In the longer term economically speaking, it is probably better to be an Italian rather than Greek or perhaps Spanish or French. It cannot be ignored though that all of Eurozone’s citizens are considerably more linked than most knew. How Italy goes will substantively define the future of the Eurozone. See FILM REPORT - "@ the G-20" - diplomaticallyincorrect.org/films/movie/the-g-20/29058 By Ambassador Muhamed Sacirbey Facebook – Become a Fan at “Diplomatically Incorrect”

 Twitter – Follow us at DiplomaticallyX
 International Financial Crisis Channel - diplomaticallyincorrect.org/c/international-financial-crisis