Thursday 24 November 2016 6:15 pm

With Italians set to vote no in a key political reform referendum, should we now expect “Italeave”?

Tim Worstall, senior fellow at the Adam Smith Institute, and author of Chasing Rainbows: Economic Myths, Environmental Facts, says Yes.

Failure by Prime Minister Matteo Renzi to win the Italian constitutional referendum should indeed lead to Italy’s exit from the EU.

Renzi has said that he will resign if he loses, which will almost certainly mean an election, the winners of which are likely to be variously anti-EU. But without serious reform of the Italian system, which is the very thing the referendum is meant to allow, it is likely that Italy will leave anyway.

Its banking system is not holding up well after decade upon decade of near zero growth. The government cannot afford to refinance it, and isn’t allowed to do so in any case. The only solution here, as Five Star Movement founder Beppe Grillo says, is to leave the single currency.

The euro is the most absurd thing anyone has done to the European economy in modern times. Its death would be a blessing. If that causes the failure of the EU, so be it. A system which impoverishes so many in southern Europe should not survive anyway.

Iain Anderson, executive chairman at Cicero Group, says No.

Be under no illusion, the referendum is a cause of huge concern in Brussels. But the case for Italeave makes a lot of assumptions.

The first is that Matteo Renzi will actually resign if he loses. The Prime Minister is known for his political dexterity. His predecessor Mario Monti said recently that if “No were to win, I would expect… Renzi to stay”.

Second, the Five Star Movement is performing well in the polls, but it is too early to conclude that they will have power in a future government.

Finally, there is deep frustration in Italy, but this does not necessarily mean that Italians would back leaving the EU. A recent survey by the Bertelsmann Stiftung, a German foundation, showed that support for the EU in Italy has grown since the UK’s EU referendum, and the number of people who wanted to leave has fallen.

Far from being an advert for leaving the EU, Brexit – so far, at least – appears to be showing the enormous challenge that Italeave would pose.

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.