Meek economic data released as populists maintain poll lead
Today, Italian authorities will update GDP figures for the three months leading to December 2017. The release comes less than a month before the general election that could influence the behaviour of the EU and international investors towards Italy.
The report indicates that the Italian economy, the Eurozone’s third largest but slowest growing, should expand by 1.5% throughout 2018, an estimate supported by strong industrial production in the last quarter.
Currently, the anti-establishment Five Star Movement (M5S) is ahead of the ruling Democratic Party (PD) in opinion polls. M5S, the strongest single party that has recently welcomed the idea of collaborating with its rivals, trails behind the centre-right coalition between Forza Italia, post-fascist Fratelli d’Italia and the formerly secessionist and far-right Lega.
With no party in a position to secure a clear majority on March 4, the rising popularity of M5S and Lega could sway the incoming parliament towards a more Eurosceptic government. Robust anti-euro voices in Italy could detract foreign investors and galvanise a withdrawal movement.
WAR IN SYRIA
UN Security Council to discuss Syrian conflict
Following a call by Secretary-General Antonio Guterres for de-escalation of the conflict in Syria, the UN Security Council is today expected to discuss the seven-year war.
The Council is expected to consider a resolution proposed by Sweden and Kuwait that, if approved, will demand a 30-day ceasefire be instituted to allow for the delivery of aid and evacuation of the wounded. Any resolution is expected to be vetoed by Russia—which has rejected 11 proposals on Syria since 2011—claiming a ceasefire would be ignored by rebels and terrorist groups.
After Islamic State controlled more than half of Syrian territory in 2015, Bashar al-Assad’s Russian-backed forces have fought back in the past year; approximately 60% of country’s landmass and 85% of the population are now under government control.
However, with Israel intensifying its attacks on Iranian-backed forces and Turkey’s offensive against Syrian Kurds continuing unabated, the potential for a spill over into new conflicts has never been higher.
Alliance defence chiefs hold first summit of the year
NATO defence ministers will gather in Brussels today for their first meeting of the year.
US Defence Secretary Jim Mattis is likely to again urge his counterparts to increase military spending to the 2% GDP target. Despite Donald Trump’s persistence, only the UK, Greece, Estonia, Romania and Poland met the 2% target last year. While France expects to hit the target by 2025, Germany—which would have to double its current defence spending—remains unyielding despite US demands.
After the EU signed its own defence pact last year, known as PESCO, Mattis’ renewed plea will likely fall on deaf ears. Indeed, PESCO, which will initially focus on military training, cyber defence and improvements to military mobility this year, could provide a unique threat to NATO, as it provides a means for European countries to cooperate on threats closer to home.
As such, the US may need to be wary that a renewed focus on European threats, such as immigration in the Mediterranean, does not detract from NATO’s missions in Afghanistan and Iraq.