3rd Mar 2024

Italy forms coalition government amid economic tension

  • Tough times ahead for the new Italian government of Enrico Letta (Photo: Bellabona Foto)

Italian leader Enrico Letta's team of ministers is set to be approved by parliament on Monday (29 April), amid warnings that Rome may have to seek financial aid from the European Central Bank (ECB)

The 46-year old Prime Minister formed his coalition cabinet on Sunday, ending two months of political deadlock after inconclusive elections in February.

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Comprising of ministers from both the centre-left and the centre-right party of former leader Silvio Berlusconi, the cabinet also includes Italy's first black female minister.

Cecile Kyenge, an eye doctor born in Congo but living in Italy for the past 30 years, will be in charge of integration.

Her appointment has already created an uproar within the anti-immigration Lega Nord party, who said she is "no Italian."

In charge of foreign affairs is another woman, Emma Bonino, a former EU commissioner and member of the European Parliament. Letta's team comprises a record seven women ministers.

European Council chief Herman Van Rompuy on Sunday congratulated Letta and vowed continued support.

"I am sure that under his leadership there will be a strong impetus for political stability in Italy," Van Rompuy said.

"His government will have full support from the European institutions for the continuation of the necessary reforms for growth and jobs, whilst respecting sound public finances, that Italy has embarked upon," the EU chief added.

A violent incident outside Letta's office on Sunday highlighted just how tough the road ahead will be, however.

An unemployed man shot two policemen and a passerby, who are now in hospital.

Rome’s public prosecutor, Pierfilippo Laviani, said after interviewing the gunman, who had no prior criminal record, that he had wanted to "shoot politicians."

He added: “He has confessed everything. He doesn’t seem like a mentally unbalanced person. He was a man full of problems. He lost his job, he’d lost everything."

Letta's newly appointed interior minister, Angelino Alfano said it was an "isolated act" and that there is no concern for "the general situation of public order in the country."

But to lower house speaker Laura Boldrini, the shooting was "another sign of despair."

"Politicians have to come back to providing concrete answers to people's needs," she said.

A statement by rating agency Moody's top man on Italy, Dietmar Hornung - who said Italy might have to seek financial assistance from the ECB - also rang alarm bells over the state of the country's economy.

"We will have to verify the commitment of the new government and its ability to resolutely pursue the huge structural reforms the country needs to improve its creditworthiness," Hornung told the La Repubblica daily.

"For now the situation remains difficult," he added.

Italy, the third-largest economy of the eurozone, is plagued by economic contraction, high unemployment and high public debt, which pushed it several times to unsustainable lending rates, prompting speculation on a potential bailout.

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