Thursday

25th May 2017

Monti groomed to be Italy's new PM

  • Mario Monti is likely to be Italy's new PM (Photo: European Commission)

In a move that is widely considered to lay the groundwork for a transitional government, Italian President Giorgio Napolitano has appointed Mario Monti senator for life.

“Professor Mario Monti has bestowed the fatherland with the highest of merits,” he said in a statement on Wednesday (9 November).

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The position is largely ceremonial, but does provide Monti with the necessary standing to head a country in peril.

Domestic press are speculating that the nomination is a prelude to being designated leader of a new government.

The move came after Napolitano had unsuccessfully sought to soothe anxious markets after Prime Minister Silvio Berlusconi announced his resignation on Tuesday evening.

Market jitters only increased the following day after a document was leaked in which the European Commission questioned the country’s capacity to meet a balanced budget by 2013.

The yield on Italian bonds shot through the roof on Wednesday, beyond the point at which Greece, Portugal and Ireland had been forced to seek financial aid.

The Standard & Poor’s Index 500 lost 3.7 percent, its worst drop in more than two months. Asian markets are almost five percent in the red.

“There is no doubt that the president of the council, the honourable Silvio Berlusconi, will step down after the approval of the stability law,” Napolitano said in a statement on Wednesday.

The law, which includes the austerity measures demanded by European leaders, he said would be approved “within days”. It is set to pass the Senate on Friday and the lower house at the weekend. A new government could be in place as soon as Monday.

Monti is an economist at Bocconi University in Milan, a Yale University graduate, and former two-time EU commissioner from 1995 to 2004 – responsible for the internal market and competition dossiers over his pair of terms in the EU executive.

Italian bonds shatter 7% bail-out ceiling

The interest rate on Italian 10-year government bonds breached seven percent on Wednesday, shattering the psychological bail-out ‘ceiling’. Greece, Portugal and Ireland all had to seek multi-billion-euro bail-outs when their 10-year bonds exceeded this threshold.

MEPs vote to start democracy probe on Hungary

The European Parliament took the first step towards launching the Article 7 procedure against Hungary for backsliding on democracy. The process might lead to sanctions, but Orban is not backing down.

MEPs preparing to crack down on Orban

The EU assembly's largest group is split by its "enfant terrible", but enough MEPs are likely to abstain or vote Yes on the "Article 7" crackdown over Orban's illiberal rule.

Schulz fails to beat Merkel in German home state

Former EU parliament leader, Martin Schulz, says the defeat of his social-democrats in North Rhine-Westphalia is "difficult". The elections showed that a "Schulz effect" does not (yet) exist.

Austria heading for snap elections

Foreign minister Kurz has taken leadership of the conservative party in what could lead to an alliance with the far-right.

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