Italy looks to ‘Super Mario’ Draghi to end political crisis

Daniel Fowler
February 4, 2021

Renzi, whose nickname is "il rottamatore", or "the demolisher", complained among other things about Conte's plan to spend more than 200 billion euros ( $240 billion) in European Union funds and loans to help the economy recover from the pandemic.

"Overcoming the pandemic, completing the vaccination campaign, offering answers to citizens' daily problems, relaunching the country", Draghi said after the announcement.

"The back-to-back announcements meant Draghi would nearly certainly be asked to lead a government of national unity to help Italy face the coronavirus emergency and manage the economic crisis, " Reuters reports.

"It's a hard moment", Draghi said.

Draghi said he would start consultations with political forces and "trusts that unity will emerge".

During his tenure at the European Central Bank, Draghi became known as "Super Mario".

The block had insisted on Mr Conte remaining premier and bitterly resented Mr Renzi's power play that brought him down.

It is not clear whether Draghi would favor a government of technocrats, as Mario Monti did in 2012, or include some political figures to increase buy-in from the parties.

He had been rumoured as a possible choice to lead a non-political government if Mr Conte was unable to find enough parliamentary support to continue leading Italy.

"It will not be a big surprise if I tell you that Mario Draghi is respected and admired in this city and beyond", said Margaritis Schinas, a vice-president of the European Commission.

In a brief statement after receiving the mandate from Mattarella, Draghi said he was confident of securing sufficient backing in parliament.

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Conte was first appointed in 2018 at the helm of a government comprising M5S and Matteo Salvini´s far-right League.

Italy's 10-year yield was 8 basis points lower at 0.57 per cent after earlier falling to 0.54 per cent while the benchmark BTP-bund spread was at 105 basis points compared with a five-year low at 102 points earlier.

After a flurry of euro zone government bond sales on Tuesday, Portugal launched a new 30-year bond due April 2052 via syndication on Wednesday. Italy, with more than 89,000 confirmed virus deaths, has the second-highest COVID-19 death toll in Europe after the UK.

Says caretaker govt could not draw up recovery fund plans.

He ruled out snap elections because of the pandemic, and instead said he would help form a "high-profile government that should not identify itself with any political formula". He suggested he was pleased with the outcome, praising Mattarella's "wise" decision.

News of Draghi's expected appointment was well-received by the financial market on Wednesday, with the Milan stock exchange rising three percent in midday trading, as he met Mattarella.

"We want to see a serious plans for cuts in taxes and bureaucracy, plans for schools, works projects to open - and obviously a prospective to a vote", League leader Matteo Salvini tweeted.

Mr Draghi, a Massachusetts Institute of Technology-trained economist, had led the Italian central bank from 2005 to 2011 when he was tapped to lead the ECB, a job he held until 2019.

He is perhaps best known for his intervention as European Central Bank chief during the peak of Europe's debt crisis in 2012.

Draghi, an economist who is credited with steering the eurozone through the sovereign debt crisis, said he accepted the mandate from Mattarella "provisionally".

Italy, the third-largest economy in the European Union, nevertheless had been heading into a recession even before it became the first country in the West to be hit hard by COVID-19 last February.

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