New Italian PM faces hard task in crisis alliance

Italy’s new prime minister will have the uphill task of reconciling his centre-left Democratic Party (PD) with the idea of governing with its fiercest opponent, while leading efforts to reverse a deep economic malaise.

Enrico Letta is poised to inherit the helm of a country which has been in a recession for seven consecutive quarters and where the economy has shrunk to its 2000 levels, while youth unemployment has shot above the 35% mark.

In his first remarks since being asked to form a government by President Giorgio Napolitano, Letta said his “surprise” at being nominated was “equal to the profound sense of responsibility that I feel weighing on my shoulders.”

He is expected to lead the PD into a coalition with Silvio Berlusconi’s conservatives and centrists led by outgoing premier Mario Monti - an outcome his party had resisted with all his might since a pyrrhic victory in February elections left it short of a clear parliamentary majority.

Berlusconi, for his part, had backed that solution all along.

The PD came around only last week, after twice failing to get its candidates elected in parliamentary voting for the presidency. Following the double debacle, it was forced to beg the 87-year-old Napolitano to stay in his post, despite his intention to retire, and bend to his will.

In his re-election speech, the head of state stressed that all political forces had to come to terms with inconclusive election results, “like them or not,” and insisted there was no other solution to a grand coalition.

“After such a speech we only have to act. Without losing time. Without partisanship. Thinking only about the country’s problems,” Letta tweeted.

Those remarks indicated a change of opinion from earlier this month, when Letta was insisting that a deal with Berlusconi was “not practicable,” while the PD was courting the protest Five Star Movement (M5S) in an unsuccessful bid for an alternative coalition partner.

A grand coalition would work “if we were in Germany and we had (German conservative leader and chancellor Angela) Merkel,” he said at a business forum on April 8. “Unfortunately we are in Italy and we have Berlusconi, it’s complicated,” he added.

Many on the left are worried about an “inciucio” - meaning a stitch-up whereby the PD would effectively have to help Berlusconi escape scot free from his legal troubles in return for his political support.

The scandal-tainted former premier has two pending trials in which verdicts are due in the coming weeks - one for tax fraud and another one for paying for sex with a minor.

Perhaps in an attempt to reassure sceptics, Letta said he was not ready to form a government “at all costs.” Napolitano, however, insisted that there were “no alternatives.”

Recommendations from two bipartisan expert groups the president appointed earlier this month are expected to guide the new administration’s policies.

Letta mentioned reducing unemployment, streamlining Italy’s inefficient parliamentary system, adopting a new electoral law to minimise the risk of future inconclusive results and getting the European Union to soften its pro-austerity stance as priorities.