Europe

Monti unveils technocratic cabinet for Italy

  • 16 November 2011
  • From the section Europe
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Mario Monti has unveiled a new, technocratic cabinet meant to steer Italy through its debt crisis after the fall of Silvio Berlusconi's government.

Mr Monti, who has now been sworn in, appointed a banker to lead a super-ministry of development, infrastructure and transport.

Mr Monti, a former EU commissioner, has sought to reassure markets that Italy will overcome its debt crisis.

Italy's borrowing costs have fallen back below the critical 7% level.

The European Central Bank eased the pressure, pushing costs down by buying up Italian bonds.

No politicians

Mr Monti took on the economy and finance portfolio himself.

Corrado Passera, CEO of the Intesa Sanpaolo banking group, was named to head the new ministry of development, infrastructure and transport.

Another key appointment was that of Antonio Catricala, head of the anti-trust authority, who was made under-secretary to the prime minister's office.

Despite reports that Mr Monti had sought to include politicians in his cabinet, there are none.

"The absence of political personalities in the government will help rather than hinder a solid base of support for the government in parliament and in the political parties because it will remove one ground for disagreement," he said.

Some analysts have said this lack of political cover may leave the administration open to being undermined in parliament.

Mr Monti still faces a confidence vote at the Senate on Thursday and at the lower house on Friday, but it looks certain that he will receive the backing of lawmakers, correspondents say.

Former Prime Minister Silvio Berlusconi has reportedly said he could "pull the plug" on the government if he does not like what it does.

Announcing his list, Mr Monti told reporters he aimed to restart economic growth in Italy.

He paid tribute to Mr Berlusconi, who resigned on Saturday, bowing to market pressure.

Mr Monti is tasked with reducing public debt of 1.9tn euros ($2.6tn; £1.6tn) and restoring economic growth.

Borrowing costs for the government have soared in recent weeks, to levels at which Ireland, Portugal and Greece needed emergency bailouts.

Italy's debt is large but is considered stable and its deficit is relatively low but Mr Berlusconi's failure to push through critical economic reforms led to a collapse of investor confidence.

"It will be a race," Mr Monti said after unveiling his cabinet. But, "we have had many signals of encouragement from our European partners and the international community.

"I believe all this will translate into... a calming of the market difficulties concerning our country," he said.

He has the backing of Italy's main political parties but still needs approval from both houses of parliament before he can take office and push through tough austerity measures.

Only one party, the right-wing Northern League, says it will withhold its support.

Mr Monti intends to remain in office until the end of the current legislature - 2013.

'Undeniable experience'

London-based economist Annalisa Piazza said the new cabinet seemed to contain a "good mix of specialties".

"A majority of names are academics with undeniable experience in their respective sectors," she was quoted by Reuters news agency as saying.

"I think that the choice of Passera... is important considering the crisis originated in the financial sector."

The Newedge Strategy economist also singled out Piero Giarda, an expert on public finances, who was made minister for relations with parliament.

Another economist, Riccardo Barbieri of Mizuho, told Reuters: "The cabinet is made up partly of people Monti knows well and trusts and partly of people who have probably been suggested to him by President [Giorgio] Napolitano as being credible...

"It's interesting that Monti has kept the economy ministry for himself. He obviously wants to be in control of what is clearly the most critical area."

Welcoming the appointment of Mr Passera, the economist added: "The only question for Italy is: 'Is it too late?'"

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