Italy to EU after Brexit: Change or risk collapse

Said that EU leaders had to understand there could be no more "business as usual" on the key issues of jobs, growth and immigration

Italian ministers warned today that the European Union must change direction or risk collapse after Britain's vote to leave the bloc.

"The unthinkable is happening," Finance Minister Pier Carlo Padoan said. "A double reaction to Brexit is under way, one financial, one political. The financial one, at least until now, is limited. I am more worried about the political one," he added.

"There is a cocktail of factors that can lead to various outcomes, including a further push towards disintegration," Padoan said.

Speaking to Corriere della Sera, Padoan also said EU leaders had to understand there could be no more "business as usual" on the key issues of jobs, growth and immigration.

Foreign Minister Paolo Gentiloni meanwhile warned it would be naive to underestimate the significance of Britain leaving or the risk of a surge in anti-EU sentiment across the continent.

"The UK was not only one amongst 28 (member states). It had a great weight because of its financial markets and its international influence," Gentiloni said in an interview with daily Il Messaggero.

"The risk (of political contagion) is such that we need to send a strong and clear message (that we are) revamping the European project."

Padoan said Europe had to face up to citizens' worries over immigration, unemployment and increasing inequality -- which meant changing the 'austerity' budget rules Rome blames for exacerbating the current crises.

"Inequality is growing in Europe because growth is weak," the minister said. "Italy respects the (deficit) rules but that does not mean we like them."

Padoan added, "In the management of Europe, Ecofin included, the prevailing attitude is almost 'business as usual'.

"But the situation we are in now is exceptional. We have to change our major priorities and we will see if (next week's) European Council sends a far-reaching signal in that sense, as it should do. We have had proposals on the table for months that say employment, growth, well-being and equality have to be the priorities," he said.

"Europe cannot only take care of the banks. We are stabilising them and will continue to do so, but we also have to look after our citizens," he added.

Gentiloni was meeting Saturday with his counterparts from Belgium, France, Germany, Luxembourg and the Netherlands -- fellow EU founding members -- for talks on the implications of the Brexit vote.