Italian president asks ‘Mr. Scissors’ technocrat to form government

Glen Norman
May 28, 2018

Italy has been without a government since elections in March because no political group can form a majority. However, markets have in the past welcomed technocratic governments in Italy.

Conte on Sunday remitted his mandate after Italian President Sergio Mattarella nixed his choice of euroskeptic economist Paolo Savona as finance minister.

Conte, who was virtually unknown until last week, was chosen by the leaders of the League and 5-Star to be prime minister after weeks of negotiations.

Mattarella used his power to reject the appointment of strong eurosceptic Paolo Savona in the role of economy minister.

The President's refusal to ratify the coalition cabinet could put Italy on track for yet another election, continuing the political deadlock in the country.

The previous parliamentary election, held March 4, failed to produce a party with enough support to govern singlehandedly. Mainstream center-left and center-right parties were seen losing further ground in the face of voter anger over the sluggish economy.

However, Salvini dismissed calls on Monday by 5-Star and a far-right ally, the Brothers of Italy, to chase Mattarella out of office.

On Sunday, Bannon met with Armando Siri, the mastermind behind the coalition's economic reform program, centred on a 15 per cent flat tax created to replace Italy's Byzantine fiscal code and significantly curb the tax evasion that is rife in the country.

"Now I am telling Mattarella that we want a date for new elections".

News of Mattarella's veto sent a shockwave through Italy.

The leaders of the two populist parties were furious over the Mattarella veto.

Under that article, the president would be voted on "for high treason or attacking the constitution" by all members of parliament.

Manlio Di Stefano, an MP from the anti-establishment Five-Star Movement (M5S), which has teamed up with Lega Nord in a parliament, argued that it was Mattarella's fault that Sunday did not bring a much-desired end to the two-month long post-election stalemate. The constitutional court would then be called to decide whether to enforce the decision.

In a statement, Mogherini said that "I have full trust, as I believe all Italians have in the Italian institutions, starting with the Italian president". Europe's single currency pulled off more than 6-month lows, and the closely watched gap between Italian and German 10-year bonds tightened almost 15 basis points.

He added: "We in Germany should hold back somewhat with advice on forming a government".

Mr. Salvini said that he had expected, as of Monday, to be Italy's interior minister, responsible for security and migration, and had been thinking, "I can't wait to send home a whole lot of illegals".

In his statement, Savona said his position on debt was the same as that forged by the potential coalition allies in their programme - which says it will be reduced not through austerity or tax cuts, but through targeted investments and policies that boost economic growth.

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