In Italy, ex-ECB boss Mario Draghi is tasked with forming a new government

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The President of the Republic Sergio Mattarella “received this morning […] Mario Draghi, to whom he gave the mandate to form the government. Mr. Draghi accepted with reservation ”, indicated the Secretary General of the Presidency, acceptance“ with reservation ”being the formula established in Italy in the phase of seeking a parliamentary majority.

“This is a difficult time […] Beating the pandemic, continuing the vaccination campaign and relaunching the country are the challenges that await us, ”said the former head of the European Central Bank after an interview with President Sergio Mattarella. He said he was “confident that unity will emerge from discussions with political parties and parliamentary groups”.

The President of the Republic Sergio Mattarella, arbiter in the event of a political crisis, had welcomed Mr. Draghi on Wednesday in the middle of the day at the Quirinal Palace. This 73-year-old man, credited with having saved the euro zone in 2012 in the midst of the debt crisis, will have to seduce the main political parties to have a parliamentary majority.

Enthusiastic reactions

Enthusiastic, the Milan stock exchange had already welcomed the probable arrival of Mario Draghi on Wednesday, increasing by 2.31% shortly after the opening. And the spread, the closely watched spread between the Italian debt rate and the German benchmark ten-year rate, lost 7.60 points to 106.05 basis points.

Mr. Mattarella spoke Tuesday evening for a government of “high level” capable “of facing the current serious crises: health, social, economic.” Calling on all political parties to support this government, he firmly ruled out the holding of early elections in the midst of a pandemic, which has already claimed more than 89,000 lives in the country and brought down the economy.

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His remarks came just after the announcement of a failure of consultations for the renewal of the outgoing coalition led by Giuseppe Conte, made up of the Democratic Party (PD, center-left), the 5 Star Movement (M5S, anti-system until coming to power) and the small Italia Viva (IV) party led by Matteo Renzi.

Matteo Renzi, a former head of the Italian government who broke the government by recently withdrawing support from his small party, jubiled Wednesday. “All people of good will must respond to President Mattarella’s call and support the government of Mario Draghi,” he commented on Twitter.

Also delighted, Romano Prodi, ex-president of the European Commission and Prime Minister (Democratic Party), judged that Mr. Draghi “will protect the country”. “In this delicate moment, it is essential to seek to reassure Europe about the credibility of our system,” he told La Stampa newspaper.

“Thank you, President Mattarella”, launched on Twitter the European Commissioner for Economic and Monetary Affairs, Paolo Gentiloni, who is also on the long list of Prime Ministers of a country of chronic political instability.

Heavy fall in GDP

To revive the battered economy, Italy is counting on a plan of more than 200 billion euros financed by the mega-European recovery plan decided in July by the European Union, while the third largest economy in the euro area has posted one of the worst GDP drops in the euro zone in 2020 (-8.3%). Italy is due to present its proposals in Brussels by April 30.

PD leader Nicola Zingaretti said he was “open to dialogue for the good of the country”. But for another leader of the party, Andrea Orlando, the only name of Draghi will not be able to “solve all the problems” by magic, and it will be necessary to roll up the sleeves to find “a convergence on a program of reforms”.

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Getting the M5S endorsement will be more complicated. The leader of the M5S senators in the Senate, Vito Crimi, has already announced that he will not support “the impractical path” of a provisional “technical government”. “This type of executive has already been adopted in the past, with extremely negative consequences for Italian citizens,” he criticized. According to him, the M5S, which wanted a government with full political powers, “will therefore not vote for the birth of a technical government headed by Mario Draghi”.

Mario Draghi, renowned for his discretion, his seriousness and his determination; is “an extremely well prepared and determined person”, commented for AFP Giuliano Noci, professor of strategy at the Polytechnic business school in Milan. “He would certainly be able to get Italy out of the crisis, with the support of the country and the Parliament”.