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Europe

Mario Monti nominated to form new government

Text by News Wires

Latest update : 2011-11-13

Economist and former European Commission minister Mario Monti was on Sunday tapped to lead Italy's new government, a day following the resignation of Silvio Berlusconi. Monti vowed to work quickly to tackle Italy's debt crisis.

 

REUTERS - Italy’s president appointed former European Commissioner Mario Monti on Sunday to head a new government charged with implementing urgent reforms to end a crisis that has endangered the whole euro zone.

After a frenetic weekend during which parliament passed the reforms and Prime Minister Silvio Berlusconi stepped down to the jeers of hostile crowds, President Giorgio Napolitano asked Monti to form a government, expected to be composed largely of technocrats.

“The president of the republic ... has received Senator Mario Monti and conferred a mandate to form a government,” said a statement from the presidential palace.

The respected economist, made a life Senator last week, is likely to name around 12 ministers on Monday, political sources said. He will have declared support in parliament from opposition parties, centrists and Berlusconi’s PDL party.

A process that normally takes several days or weeks was completed over the weekend as Napolitano raced to restore market confidence that collapsed disastrously last week.

Following weeks of political uncertainty and growing calls from international partners for action to control its debt, Italy’s borrowing costs soared to unmanageable levels last week, threatening a Europe-wide financial meltdown.

Markets calmed at the end of the week once it became clear that Berlusconi would go and Monti take his place. Rome will watch on Monday to see if the formal nomination will continue the positive effect on markets.

If he manages to secure sufficient backing in parliament, Monti will implement reforms agreed by Berlusconi with euro zone leaders to cut Italy’s massive debt and revive a chronically stagnant economy.

However there are clear signs that he will face problems, with Angelino Alfano, secretary of Berlusconi’s PDL party, saying there was “huge opposition” among some of its members to a Monti government.

Alfano said after meeting Napolitano on Sunday afternoon, however, that the party—which has been badly split by the crisis—would support Monti.

But its agreement was conditional on the ministerial line-up and the policy programme of the new government, which must be based on reforms promised to Europe by Berlusconi.

Uphill battle

Outgoing Interior Minister Roberto Maroni, a senior figure in the devolutionist Northern League, confirmed that the party opposed the expected technocrat government and said Monti would face an uphill battle.

“The decisions which Monti will take must pass in parliament and I think that with such a heterogeneous majority he will have many problems. I believe this solution will lead to many problems,” Maroni said in a television interview.

The League, allied with the PDL in the outgoing government, adamantly opposes pension reform that would hit older voters who are among its key supporters.

Italy’s political turmoil was very much centred around the flamboyant and scandal-plagued figure of Berlusconi and thousands of demonstrators partied in the streets of Rome on Saturday night after he resigned.

The normally ebullient media magnate cut a forlorn figure as he stared from his car, looking pale and drawn, when he left Napolitano’s palace to shouts of “clown, clown”.

He said in a televised message on Sunday that he was saddened by the demonstrations but had resigned from a sense of responsibility to end speculative attacks on Italy.

“It was ... sad to see that a responsible and if you will permit me to say, generous act, like resigning was greeted with whistles and insults,” the 75-year old media magnate said.

German Chancellor Angela Merkel welcomed signs of an end to the weeks of uncertainty, saying the approval of a reform package in parliament on Saturday was “heartening”.

“I hope that confidence in Italy is restored, which is crucial for a return to calm throughout the euro zone,” she said ahead of a party conference in Leipzig. 

Date created : 2011-11-13

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