Italy's planned structural reforms are unlikely to be seriously affected by the withdrawal of support by Silvio Berlusconi's PDL party for Italian leader Mario Monti's economic reforms, said Alken's Nicolas Walewski.
Speaking exclusively to Citywire Global, the European equity star said the possibility of earlier elections in Italy and the political instability this could cause has not changed his view on the long-term prospects of the country.
'Whilst Italian political instability is never good news in the short-term, our opinion at this stage is that anticipated elections would hardly change the reality that the next governing party/coalition would be run by a centred coalition that will be definitely “pro Europe”,' he told Citywire Global.
'Given this pro-Europe approach, we don’t anticipate that the planned structural reforms will be affected, and therefore it doesn’t change our long-term view on Italy.'
While Walewski admits the news could raise the risk of governmental unrest and force Italian President Giorgio Napolitano to call for earlier elections, a return to the Berlusconi era is 'highly doubtful', he said.
'Based on recent polls, PDL as well as the Northern League are enjoying very little popularity.'
'Therefore assuming the next elections are based on the current voting system, it is highly doubtful that either Berlusconi, or a PDL+Northern League coalition could ever win a majority, in the Lower House anyway.'
Over the past three years the Alken European Opportunities fund has returned 30.5% while its benchmark, Stoxx Europe 600 TR, has risen 27.35%.