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17 November 2011

WSJ: Italian premier appoints emergency government


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Italian Prime Minister, Mario Monti, on Wednesday appointed an emergency government of technocrats who now face the delicate task of restoring investor confidence in the eurozone's third-largest economy and pulling it out of the spiralling debt crisis.


Mr Monti rebuffed the scepticism, saying "the non-presence of political personalities will make it easier" to act decisively in rolling out economic measures. The new cabinet will come under immediate pressure to adopt measures to reboot Italy's stagnant economy and lower the country's massive €1.9 trillion debt. European Union authorities and economists have called on Rome to introduce a raft of measures, including overhauls to Italy's restrictive labour market and costly pension system.

Some economists say the outsider status of Mr Monti's cabinet could give it an edge in pushing through unpopular economic measures, because his team isn't beholden to specific political parties. "It is hard to find fault with the calibre of Mr Monti's ministers", said Nicholas Spiro, who runs a London-based consultancy on sovereign debt. "They are all respected academics and experts who bring considerable experience and ability to their respective portfolios."

Mr Monti, however, needs strong backing from Parliament. On Thursday, his cabinet is expected to face a confidence vote in the Senate, the upper house of Parliament, where members of Silvio Berlusconi's conservative People of Freedom Party and his main ally, the Northern League, still command a majority of the votes. Mr Monti's government is expected to win the vote, but the margin of victory will be crucial measure of Mr Monti's ability to sustain parliamentary support as he pushes through his agenda. So far, centre-left parties strongly support Mr Monti, and Mr Berlusconi's lieutenants have said his party will support the emergency government. But some analysts say the lack of politicians in Mr Monti's cabinet is a sign that major political parties want to keep their distance from the government—and keep it in check.

Full article



© Wall Street Journal


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