Italy heads to new elections as caretaker PM is named
LATEST CRISIS WAS SPARKED WHEN THE PRESIDENT VETOED THE NOMINATION OF A MINISTER
Italy was hurtling to new elections within months yesterday as the country is mired in political chaos after a bid by two populist parties to form a government collapsed.
The latest crisis was sparked when President Sergio Mattarella vetoed the nomination of fierce Euro-sceptic Paolo Savona as economy minister in a coalition of the far-right League and anti-establishment Five Star Movement.
His action on Sunday — which came after months of political turmoil in the wake of an inconclusive March election — sparked angry calls for his impeachment.
Yesterday, Mattarella chose Carlo Cottarelli, an economist formerly with the International Monetary Fund, to form a caretaker government to take Italy into new elections.
The chaos sent Italian stocks tumbling by as much as two per cent at one stage, and bond yields surging.
Cottarelli said that should his technocrat government win parliamentary approval, it would stay in place until elections at the start of 2019.
“I will come to parliament with a programme that, if I win the vote of confidence, will include a vote on the 2019 budget. Then parliament will be dissolved, with elections at the start of 2019,” he said.
But if parliament fails to approve his government, a new election would be held “after August” — the most likely outcome given only the centreleft Democratic party has announced that it would vote in favour.
The League and the Five Star abandoned their plans to form a coalition government after the president’s veto of Savona, and their approved nominee for prime minister, lawyer and political novice Giuseppe Conte, stepped aside.
Mattarella, 76, said he had accepted every proposed minister except Savona, who has called the euro a “German cage” and has said that Italy needs a plan to leave the single currency “if necessary”.
The leaders of Five Star and the League, Luigi Di Maio and Matteo Salvini, furiously denounced the veto, decrying what they called meddling by Germany, debt ratings agencies and financial lobbies.
Cottarelli, 64, was director of the IMF’s fiscal affairs department from 2008 to 2013 and became known as “Mr Scissors” for making cuts to public spending in Italy.