Reuters: Monti needs to go beyond Davos crowd to conquer Italy

26 January 2013

Mario Monti was preaching to the converted at an annual meeting of elite bankers and policymakers in Davos, but he must woo austerity-hit Italians and fend off a populist offensive to have similar success at national elections next month.

The Italian prime minister, an internationally respected former European Commissioner who now leads a centrist coalition, was welcomed as a hero as he arrived in this Swiss ski resort for a two-day stint at the World Economic Forum (WEF). Foreign bankers who met Monti at a 45-minute, closed-door session described him as charming and thanked him for "saving Italy and Europe" when he took the helm of a technocrat government at the peak of the eurozone crisis 15 months ago. Yet there was concern that promises of lower taxes and an easy way out of recession made by centre-right leader and former prime minister Silvio Berlusconi may resonate among ordinary voters and end up derailing Italy's reforms.

Giulio Tremonti, a former economy minister under Berlusconi and fierce opponent of Monti, criticised the prime minister for spending time with the "enlightened in Davos" while a crisis raged back home over secret derivatives trades at bank Monte dei Paschi di Siena. The mounting crisis at Italy's third-largest lender, a bank with strong links with the centre-left, risks eroding support for the Democratic Party.

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