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Italian president asks economist to form government

May 28, 2018

President Sergio Mattarella has tasked a former IMF economist with trying to set up a new government in Italy, months after an election and a day after he vetoed a proposed finance minister.

Former senior International Monetary Fund (IMF) official Carlo Cottarelli (right) meets the Italian President Sergio Mattarella at the Quirinal Palace in Rome, Italy, May 28, 2018.
Image: Reuters/Italian Presidential Press Office

Carlo Cottarelli mandate

President Sergio Mattarella has appointed Carlo Cottarelli, an economist previously with the International Monetary Fund (IMF) as prime minister after meeting the 64-year-old at the presidential Quirinal palace on Monday morning.

Cottarelli will struggle to gain the approval of parliament with Five Star and the League commanding a majority in both houses — the parties are likely to oppose any potential government he can put together in a parliamentary vote.

Read moreItaly's options: A fraught government or new elections?

After the announcement, Cottarelli said he would put together a government "very quickly."

"I'll present myself to parliament with a program which — if it wins the backing of parliament — would include the approval of the 2019 budget. Then parliament would be dissolved with elections at the beginning of 2019," Cottarelli said. "In the absence of [parliament's] confidence, the government would resign immediately and its main function would be the management of ordinary affairs until elections are held after the month of August."

Three months after March's inconclusive election, talks collapsed on Sunday between Mattarella and the populist parties, Five Star and the League, hoping to form a coalition.

Euroskeptics still in the ascendency

The process collapsed after Mattarella vetoed the Five Star movement's selection for finance minister, the overtly euroskeptic Paolo Savona. The leaders of Five Star and the right-wing League, who were trying to set up a coalition, said that they would seek impeachment for the president. They called the move meddling by Germany, debt ratings agencies and financial lobbies.

Savona had called the euro a "German cage" and has said Italy needs a plan to leave the single currency "if necessary."

The two parties' approved nominee for prime minister, Giuseppe Conte, stepped aside over the decision.

Known as "Mr Scissors" for his cuts to public spending, Cottarelli was director of the IMF's fiscal affairs department from 2008 to 2013.

Cottarelli served in the broad-based Enrico Letta government in 2013 and found €32 billion ($37 billion) in cuts, not all of which were implemented.

jbh/msh (AFP, AP)