In a surprising turn of events, Italian Prime Minister Giorgia Meloni’s government is embarking on a privatization program to alleviate the country’s staggering public debt, expected to surpass 2.8 trillion euros ($3 trillion). Meloni, who once labeled Italy’s postal service, Poste Italiane, as a “crown jewel” that must remain under state control, is now selling a stake in the company as part of a broader plan to raise 20 billion euros ($21.6 billion) by 2026.

The ambitious privatization program extends beyond Poste Italiane, encompassing shares in rail company Ferrovie dello Stato and energy giant Eni. Despite Meloni’s assurance of maintaining state control, analysts doubt the effectiveness of these sales in significantly reducing the colossal debt burden.

Meloni’s shift from her 2018 stance against the privatization of Poste Italiane has sparked criticism from opposition parties. The original plan to retain a 51% majority in Poste Italiane may see a reduction to as low as 35%, according to Finance Minister Giancarlo Giorgetti. The move has triggered concerns about the government giving up control over critical assets.

As the partial privatization campaign unfolds, Meloni’s coalition faces backlash, with accusations that they are compromising national interests. Lawmaker Andrea Orlando criticized the government, stating, “We think that the homeland cannot be sold.”

The government’s efforts to attract foreign investors have been highlighted by Giorgetti, who claimed that they are “all very interested” in the stakes owned by the Italian state. However, skeptics argue that these partial privatizations, including the recent sale of a quarter stake in Monte dei Paschi di Siena, the world’s oldest bank, for 920 million euros, are insufficient to address the structural issues contributing to Italy’s debt crisis.

With the debt-to-GDP ratio expected to remain high, reaching 140.2%, economists question the efficacy of these privatization measures. Lorenzo Codogno, the Italian Treasury’s former chief economist, emphasizes the government’s sacrifice of steady dividends from companies like Poste Italiane in pursuit of short-term financial gains.

As Italy grapples with economic challenges, the government’s privatization strategy aims to send a signal to the markets about its commitment to addressing the debt problem. However, doubts persist about the viability of achieving the ambitious 20-billion-euro target by 2026 and the long-term impact of relinquishing control over key national assets.