Financial crisis haunts Italy amid poll turmoil

Remo Casilli  Reuters  Reuters

Italy's populist parties will be sworn in to power on Friday in Rome after they reached a new coalition deal, narrowly avoiding snap elections and setting in motion an anti-austerity government in the eurozone's third largest economy.

New Prime Minister Giuseppe Conte, 53, was sworn in at the head of the first populist government in an European Union founding member that was forged by the Five Star Movement and the far-right League.

President mattarella said he could not appoint the eurosceptic paolo savona to the post, citing concern from investors at home and overseas, and tasked prime minister cottarelli with forming a government instead.

Conte's government faces mandatory confidence votes next week in parliament, where the two governing parties have a slim majority.

The handover of power follows an inconclusive March election and months of political turmoil which had spooked global financial markets and spread unease among Italy's European Union partners.

But by Thursday night, 5-Star leader Luigi Di Maio and League leader Matteo Salvini found the compromise that earned them President Sergio Mattarella's blessing to form a government.

Despite pledges to work together, Luigi Di Maio's pro-EU Five Star Movement (MS5) and Matteo Salvini's far-right Lega have so far failed to formed a successful alliance.

Italy has struggled to form a government since its March 4 elections.

"Let's find someone of the same calibre as Savona, who would still remain in the government in another ministry", Di Maio said on Facebook after meeting with Mattarella.




President Sergio Mattarella on Thursday approved a cabinet list presented by Giuseppe Conte.

After the denegrating remarks were reported in top Italian news websites, the Italian President of the European Parliament, Antonio Tajani, urged Mr. Juncker to deny remarks that he deemed "unacceptable", opening a new front in Italy's increasingly complicated relations with its EU partners. "To overcome our common challenges, we need unity and solidarity more than ever", he said in a letter.

It also came on the eve of the day that Italians celebrate Republic Day, the day in 1946 when Italy abolished the monarchy and gave birth to the First Republic.

After the swearing-in, Salvini told reporters his first order of business would be to "reduce the arrivals and increase the expulsions" of migrants, as well as the costs associated with their care.

In the new cabinet, Savona will serve as Minister for European Affairs.

Premier Giuseppe Conte and his newly sworn-in Cabinet had places of honor to view the pomp-filled military parade and Italy's aeronautic acrobatic squad.

"The populist and right-wing government has a program that's unsafe for the country and the events of recent days confirm our longstanding concerns", said Maurizio Martina, a leader of the Democratic Party, which will now leave government for the opposition.

Mattarella vetoed the populist coalition's anti-euro choice for economy minister Savona, causing the two populist parties to abandon their joint bid for power.

Equity indexes around the world fell after the United States said it would impose tariffs on aluminum and steel imports from Canada, Mexico and the European Union and Washington's allies took steps to retaliate against US goods. "That means more work, less corruption, seriousness", he said.

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