Only a day after the exit of Berlusconi, Giorgio Napolitano as the President of Italy gave his formal approval to Mario Monti to become the new Prime Minister on Sunday. In doing so, the cool and competent 68-year-old Monti has replaced the charismatic and flamboyant Silvio Berculoni to head Italy. Lovingly called ‘Super Monti’, the new Italian Premier has recently received the “senator for life” title from the Italian President for his distinguished role as an economist and as ex-European Commissioner.
It is said that Mario Monti had initially showed interest to form a coalition government, but after most of the major parties showed their reluctance, that idea was shelved. It is now expected that the new cabinet would consist largely of technocrats.
As the new Italian Premier, Mario’s priority will be to implement austerity measures, arrest Italy’s piling debt crisis and win back the confidence of financial markets. Not an easy task, considering that Monti will be closely watched not only by his own country, but also by the EU leaders and skeptical investors. It is indeed ‘the’ testing time for Italy’s Super Mario and also a nerve-racking moment for Europe who are desperate to cut back on Euro risk (currency).
Showing posts with label Silvio Berlusconi. Show all posts
Showing posts with label Silvio Berlusconi. Show all posts
Sunday, November 13, 2011
Italy’s Silvio Berlusconi bows out of Prime Ministership
Silvio Berlusconi, the longest-serving Italian Premier since World War II, stepped down on Saturday. His exit marks an end to a political career spanning almost two decades. The resignation of the three-time elected Premier in Italy came immediately after the parliament gave sanction to austerity measures to address debt crisis.
With Berlusconi’s big exit, President Giorgio Napolitano is now expected to appoint a new government, probably headed by a technocrat. The name that is coming up as the most likely candidate for the prime ministerial’s post is that of Mario Monti. His role as a respected economist and also as former European Commissioner gives him an edge over others in leading Italy through the current debt crisis and stepping up economic reforms. Monti is also said to enjoy the support of financial and European institutions.
The priority of the new government would be to step up measures to reduce Italy’s huge public debt (amounting to 1.9 billion Euros), steer its economy on the path of growth and to get back investors’ confidence in Italian economy.
Though Silvio Berlusconi’s party, Pasok, has given its support to Mario Monti, they might want to have a say in the composition of new cabinet.
With Berlusconi’s big exit, President Giorgio Napolitano is now expected to appoint a new government, probably headed by a technocrat. The name that is coming up as the most likely candidate for the prime ministerial’s post is that of Mario Monti. His role as a respected economist and also as former European Commissioner gives him an edge over others in leading Italy through the current debt crisis and stepping up economic reforms. Monti is also said to enjoy the support of financial and European institutions.
The priority of the new government would be to step up measures to reduce Italy’s huge public debt (amounting to 1.9 billion Euros), steer its economy on the path of growth and to get back investors’ confidence in Italian economy.
Though Silvio Berlusconi’s party, Pasok, has given its support to Mario Monti, they might want to have a say in the composition of new cabinet.
Wednesday, November 9, 2011
European debt crisis threat as Italian Bonds touches new high
The fear of European debt crisis became more pronouned on Wednesday as Italian government bond spiked to a new high of 7 percent plus. Italian market tumbled in the afternoon as bonds breached the important threshold of 7 percent, triggered by the fear that EU has no rescue plan for Italy. This had a spiraling effect on other world markets, including Asian markets on early Thursday.
Italy, a core Euro zone member and the 8th largest world economy, is the world’s third largest bond market. Its debt amounts to a huge 2.6 trillion Euros – considered too much to be absorbed by EU.
German chancellor, Angela Merkel, warned that unless concrete and quick structural reforms take place to cut cost, it could result in collapse of the Euro currency. Angela Merkel has also demanded changes in the EU treaties.
The European Central Bank has bought, until recently, large chunks of Italian bonds to cut back its borrowing cost. But it is unlikely that the bank will be willing to buy any more after the new high.
As the resignation of Italian Prime Minister, Silvio Berlusconi, is still a month away, investors confidence has gone southward. Experts feel that Wednesday’s market reaction is not because of its poor fundamentals but because of fear of instability triggered by lack of decisive action on the part of Italian Premier.
Italy, a core Euro zone member and the 8th largest world economy, is the world’s third largest bond market. Its debt amounts to a huge 2.6 trillion Euros – considered too much to be absorbed by EU.
German chancellor, Angela Merkel, warned that unless concrete and quick structural reforms take place to cut cost, it could result in collapse of the Euro currency. Angela Merkel has also demanded changes in the EU treaties.
The European Central Bank has bought, until recently, large chunks of Italian bonds to cut back its borrowing cost. But it is unlikely that the bank will be willing to buy any more after the new high.
As the resignation of Italian Prime Minister, Silvio Berlusconi, is still a month away, investors confidence has gone southward. Experts feel that Wednesday’s market reaction is not because of its poor fundamentals but because of fear of instability triggered by lack of decisive action on the part of Italian Premier.
Italian Premier selected Angelino Alfano as the next party head
On Wednesday, the outgoing Prime Miniter of Italy, Silvio Berlusconi, pushed for early elections in 2012 . The Italian Premier claimed that he is not going to contest in the next election. But the longest-serving Italian Prime Minister named Angelino Alfano, as the head of People of Freedom party and likely candidate for the Prime ministerial’s post.
In the mean time, the fear of Italy’s debt crisis worsened on Tuesday as its financial market reacted adversely to the news. Its 10-year government bonds hit a shocking 6.95 percent, a jump of another 0.37 percent from Tuesday’s high. Experts have estimated that over the next few years, Italy would need 825 billion to 907 billion Euros in capital flow to tide through the debt crisis.
Silvio Berlusconi offered to vacate his chair on Tuesday after losing overall majority in Parliament. The announcement came after Berlusconi’s centre-right coalition managed 308 votes out of 316 votes, 8 votes short from absolute majority. The 70-year-old dominant Italian figure would, however, stay until budget reforms are passed by the Italian Parliament. As of yet, no date has been confirmed regarding vote on budget, but it is likely to be later this month.
In the mean time, the fear of Italy’s debt crisis worsened on Tuesday as its financial market reacted adversely to the news. Its 10-year government bonds hit a shocking 6.95 percent, a jump of another 0.37 percent from Tuesday’s high. Experts have estimated that over the next few years, Italy would need 825 billion to 907 billion Euros in capital flow to tide through the debt crisis.
Silvio Berlusconi offered to vacate his chair on Tuesday after losing overall majority in Parliament. The announcement came after Berlusconi’s centre-right coalition managed 308 votes out of 316 votes, 8 votes short from absolute majority. The 70-year-old dominant Italian figure would, however, stay until budget reforms are passed by the Italian Parliament. As of yet, no date has been confirmed regarding vote on budget, but it is likely to be later this month.
Tuesday, November 8, 2011
Italy on jitters over the debt crisis
After Greece, it is Italy’s turn to be hit by the spiraling debt crisis. On Monday, Europe’s financial crisis worsened as Italian government bond almost touched 15-year high, aided by slow economic growth. Like Greek Prime Minister George Papandreou, pressure mounted on Italian Prime Minister, Silvio Berlusconi, to resign and allow a new government to exercise reforms to reduce debt. But unlike Papandreou, the Italian Prime Minister refused to step down from his chair.
Unlike Greece, Portugal and Ireland, Italy needs a huge rescue package. The Italian debt amounts to 1.9 trillion Euros. It is feared that arranging for such a massive bail-out package could bring down the European Union, if not the global economy.
Monday saw the 10-year government bond of Italy touch 6.6 percent, the highest since Euro was introduced in 1997. As interest rate rises, government has to pay out more from its budget to investors who own these government bonds, thereby getting into debt.
The austerity measures promised by Italy to the European Central Bank was supposed to be passed before November 15th, current year. But that is caught in the deadlock because of conflicting interest within the government.
In an effort to save Italy from going under further debt crisis, European Central Bank has been buying government bonds to check its borrowing costs. But to tackle debt crisis, the Italian government must be prepared to take tough stand.
Unlike Greece, Portugal and Ireland, Italy needs a huge rescue package. The Italian debt amounts to 1.9 trillion Euros. It is feared that arranging for such a massive bail-out package could bring down the European Union, if not the global economy.
Monday saw the 10-year government bond of Italy touch 6.6 percent, the highest since Euro was introduced in 1997. As interest rate rises, government has to pay out more from its budget to investors who own these government bonds, thereby getting into debt.
The austerity measures promised by Italy to the European Central Bank was supposed to be passed before November 15th, current year. But that is caught in the deadlock because of conflicting interest within the government.
In an effort to save Italy from going under further debt crisis, European Central Bank has been buying government bonds to check its borrowing costs. But to tackle debt crisis, the Italian government must be prepared to take tough stand.
Subscribe to:
Posts (Atom)
